Scotland announces moratorium on underground coal gasification

The announcement is separate to a previously announced moratorium on onshore unconventional oil and gas including hydraulic fracturing, or fracking, which was announced in January, the government said.

The government announced the second moratorium as it published a planned research and public consultation timetable for onshore unconventional oil and gas. It said that public consultation will begin once the research process has been finalised and the results published.

"This will give the public a chance to study the research reports before taking part in the public consultation," it said. The consultation phase, including engagement, public consultation and analysis, is due to finish in spring 2017.

The government said it was treating UCG as a separate technology, subject to a different licensing regime. While it will take a "cautious, evidence-based approach" to both techniques, the separate moratorium on UCG will give it time for "full and careful consideration of the potential impacts of this new technology".

The Scottish government has appointed professor Campbell Gemmell, former chief executive of the Scottish Environment Protection Agency, to lead an examination of the issues and evidence surrounding UCG. This will include working with communities and stakeholders to understand the issues of most concern to them, it said.

While powers to award onshore unconventional licences are being devolved to the Scottish government, the power to award rights to exploit coal resources for UCG remain with the UK government and Coal Authority and there is no current proposal to devolve these to Scotland. As a result, the moratorium on UCG will be implemented at Scottish planning authority level, the government said.

Energy expert Bob Ruddiman of Pinsent Masons, the law firm behind Out-Law.com said: "Scotland's public consultation on shale should be the catalyst for setting out what is acceptable to individuals, communities, industry and investors, and ultimately determine what the future is for shale gas in Scotland.”

"Investors want clarity and predictability, and most will have global portfolios that feature other countries and industries competing for capital. At a UK level there will be concern that a drawn-out consultation will delay investment, while potential fragmentation of the UK’s fiscal and regulatory regimes could have consequences for England and Wales as much as Scotland,” he said.

"Of course, industry has a part to play and has a duty to engage, communicate and encourage listening by communities and to address concerns with facts and evidence. Genuine engagement and debate will ultimately yield positive results,” Ruddiman said.

Plans for shale gas exploration at a site between Preston and Blackpool were rejected by local councillors in June.

Energy company Cuadrilla had applied for permission to conduct drilling, hydraulic fracturing and gas flow testing on a site at Preston New Road, Little Plumpton. However, Lancashire County Council's (LCC) Development Control Committee rejected the application, ignoring the recommendations of the planning officer. A separate application submitted by Cuadrilla to undertake shale gas exploration activities at Roseacre Wood in Lancashire was also rejected by LCC.

A House of Lords committee said in May that a regulated shale gas industry in the UK should be an urgent government priority.