Union Jack Oil PLC (LON:UJO) and Europa Oil & Gas Holdings PLC (LON:EOG) have reassured investors that their operations will not be affected by a recent decision by the UK government to ban fracking.
In a major reversal of policy on Saturday, the government announced that fracking, also known as hydraulic fracturing, a method of pumping high-pressure water, chemicals and sand underground to split shale rock and release oil and gas, will be halted in England immediately following a series of earthquakes at the country’s only fracking site at Preston New Road in Lancashire.
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The Department for Business, Energy & Industrial Strategy said a report by the industry regulator, the Oil & Gas Authority (OGA), had concluded that it is “not currently possible to accurately predict the probability or magnitude of earthquakes linked to fracking operations”, and as a result the practice will not be allowed to continue.
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On Monday morning, Union Jack said the decision will have “no impact” on its current or future operations and that it has “no intent to engage in hydraulic fracturing operations in England, neither now nor in the future”.
Similarly, Europa said it has “no involvement” in fracking operations in the UK and that the ban will have “no impact on Europa’s conventional oil production and development activities in England”.
Investor’s seemed to breathe a sigh of relief in early trading, with Union Jack’s shares rising 1.4% to 0.2p while Europa was 0.9% higher at 2.2p.
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