There was good news for the UK onshore oil & gas industry on Thursday as the British government threw its weight behind a dash for gas.
Shares in companies across the sector bounced as the Oil & Gas Authority awarded 93 onshore hydro-carbon licences across 159 blocks.
Firms welcomed the announcement, which adds to the existing 137 licences across 360 blocks from the previous 13 licencing rounds.
Chief executive of the UK Onshore Oil & Gas Group (UKOOG), Ken Cronin, said: "This is a vital day for the future of energy in the UK."
But the news caused outrage among environmentalists as about 75% of the blocks contain shale - prompting fears that firms may use fracking to extract gas.
Friends of the Earth energy campaigner, Rose Dickinson, said: "The government is ignoring evidence of the risks and the wishes of local communities, by weakening regulation and opening up more of the country to fracking."
Final say
The news is the latest in a string of announcements that appeared to show that ministers see gas - and possibly fracking - as one of the main planks in the UK's future energy strategy.
Last month, the government said local government secretary Greg Clark, rather than local councils, would have the final say over controversial plans for fracking in Lancashire.
Earlier this week, a government-sponsored task force said shale gas drilling was relatively safe and should be allowed in the UK subject to strict environmental and safety conditions.
And on Wednesday, MPs voted by 298-261 in favour of fracking under national parks, Areas of Outstanding Natural Beauty (AONBs), Sites of Special Scientific Interest (SSSIs), World Heritage sites and groundwater protection zones.
It also follows a string of ministerial announcements reducing support for renewable energy sources such as solar and onshore wind.
The OGA said three quarters of the blocks in the latest licensing round "relate to unconventional shale oil or gas" and stressed that they would be subject to conditions.
A spokesman said: "Additional regulatory requirements apply to this kind of activity."
Unconventional prospectivity
Companies involved welcomed the news. IGAS Energy (LON:IGAS), whose shares rose 4.3% to 21.25p, gained a further 10 blocks in the second tranche of the latest licensing round in addition to the seven blocks awarded in the first tranche.
They are in the East Midlands and Yorkshire, north-west England and south-east England.
In the East Midlands and Yorkshire, blocks SE31c and SK59b have been offered to a joint venture comprising IGas, Total E&P UK and Egdon Resources (LON:EDR). Egdon's stock lifted 18.2% to 9.75p.
IGAS chief executive Stephen Bowler said the move would significantly increase its acreage by about a quarter across the key UK shale basins.
"We already operate over 100 sites across the country and will continue to ensure that, in all existing and new areas, we engage with the local communities," he said.
"This is a critical time for the future of Britain's energy mix as gas, of which 50% of our consumption is currently imported, is central to our energy security."
Europa Oil & Gas (LON:EOG) has won interests in three onshore licences in its existing portfolio and operatorship of one of the licences. Its shares rose 4.35% to 3p.
Chief executive Hugh Mackay said: "Whilst the new blocks are predominantly prospective for conventional oil and gas, there is some unconventional prospectivity.
"All our new licences have strong partner groups and we are excited by the opportunity to take these new assets forward."
Environmental groups were unconvinced, pointing out that the news follows hard on the heels of the historic climate change agreement in Paris.
Greenpeace alleged that some of the companies involved in the latest round were either wholly or partly owned by entities based in offshore tax havens.
Greenpeace energy campaigner Hannah Martin said: "Just days after an historic agreement at the Paris climate summit to move towards a renewable energy future, the UK government’s gung-ho approach to a new fossil fuel industry is bizarre and irresponsible."