British Gas owner Centrica sets sights on shale gas drilling licences

  • @MLeftly

News that British Gas owner Centrica is in talks to buy into Cuadrilla Resources, chaired by former BP boss Lord Browne, could prove a major boost to the UK's nascent shale gas industry.

Sources confirmed that Centrica is negotiating to buy into the Bowland Shale licences owned by Cuadrilla in Lancashire.

"This would be a real boost for UK shale development," said Peter Atherton, an analyst at Liberum Capital. "Centrica brings great resources and great upstream experience."

Cuadrilla, which is part-owned by the private-equity fund of which Lord Browne is a director, suffered a blow in 2011 when operations were suspended following earthquakes in the area in which it was fracking.

Chancellor George Osborne, though, is a fan of shale gas, and Centrica seems convinced that fracking could be the way of increasing reserves and reducing energy bills.