'Fracking compensation scheme should be community based', Law Society says
Compensation schemes for land and homeowners affected by fracking in the UK should be community based and possibly tiered, depending on the level of exploration and work undertaken, the Law Society of Scotland said today, July 25.
The Society was responding to a UK Government consultation, which makes proposals to reform the procedure for gaining underground access to oil or gas deposits and geothermal energy, and provide a compensation framework for landowners.
Yasmin Arshed, member of the Society's Energy Law Committee said: "The issue of underground drilling is clearly a sensitive one, and it is important to ensure that the right framework is in place to support industry and local communities as well as safeguarding the environment and public safety. We would support the proposal to make a community payment rather than an individual landowner payment, however it is unclear how payments are going to be made and thereafter distributed to the community. We also would suggest consideration be given to whether or not a single lump payment is always the appropriate option or whether compensation payments should be tiered and linked to different levels of work, such as exploration or testing, development and, finally, production. If tiered, then further consideration would have to be given to whether a backstop cap would be introduced so as not to hinder industry with an onerous fee scale."
The drilling industry is proposing that payments and notification for access be administered through voluntary schemes.
Arshed continued: "While we are broadly supportive of a voluntary scheme, it could give rise to a lack of uniformity in approach by different companies in different parts of the country. We believe that the government should monitor adherence to any voluntary scheme and consider putting it on a statutory footing if it is not being complied with."
Notes to editors
The consultation document and the Law Society's full response can be found on the Society's website
The Law Society would like to make it clear that we do not comment on fracking in the response and are not taking a view either way as to whether or not fracking should go ahead. This is purely a matter of policy and for the Government to decide.
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