LONDON, May 24 (Reuters) - Britain's first fracked shale gascould flow this year after local government officials innorthern England approved Third Energy's plans late on Monday tocarry out fracking at an existing well.
Councillors in North Yorkshire voted in favour of theproject on Monday after two days of hearings.
Third Energy said it could start fracking work, whichinvolves extracting natural gas trapped in tight layered rockformations by injecting high-pressure water, sand and chemicals,before the end of the year.
"If this flows then we will need to assess how it performsfor some months before making any conclusions," said ThirdEnergy Chief Executive Rasik Valand.
Third Energy, which is owned by former employees of theBarclays Natural Resource Investments private equity business,is the first company in years to receive local governmentapproval for a fracking permit.
Britain is estimated to have substantial amounts of shalegas trapped in underground rocks and Prime Minister DavidCameron has pledged to go all out to extract those reserves tohelp offset declining North Sea oil and gas output.
Last year, competitor Cuadrilla Resources had two permitsrejected by officials in Lancashire. Cuadrilla has appealedagainst the decision and the government has since changed therules to have the ultimate say in shale gas related application.
Shares in fellow British shale gas companies IGas and Egdon Resources soared on Tuesday following thepermit approval. IGas shares were up 25 percent and EgdonResources traded 19 percent higher at 0957 GMT.
Cuadrilla, which is waiting for a government decision togrant permits, said it could flow first gas from fracking inmid-2017, placing Third Energy at the forefront of Britain'srace to develop shale gas resources.
Only one shale gas well near Blackpool, in Lancashire, hasso far been fracked in Britain but was later abandoned when someof the work undertaken triggered an earth tremor that resultedin an 18-month ban on the technology in 2011.
Many environmental campaigners are opposed to fracking,saying the technology can damage the countryside and contributeto climate change through carbon emissions.
"This isn't over and people will continue to raise theirvery valid concerns and keep fighting against fracking," saidDaisy Sands, head of energy at environmental group Greenpeace.
(Reporting by Karolin Schaps, editing by David Evans)
