Friends of the Earth, the environmentalist group, might be feeling a bit betrayed this week.
Back in the 90s they loved Lord Deben – AKA John Gummer – calling him “the best environmental secretary we’ve ever had”.
He’s a committed green and investor in renewable energy. Even after he lost his post in 1997, he pushed green issues from the backbenches and was instrumental in passing the Climate Change Act of 2008. So he has more credibility than your average government cheerleader.
That’s why David Cameron made him the chairman of the government’s advisory body on climate change last year.
Thing is though, this week he weighed in on a controversial topic: fracking.
So what exactly did he say?
“It just isn’t true that fracking is going to destroy the environment and the world is going to come to an end if you frack… and yet to listen to some people on the green end, that’s what they say.”
He went on to say that fracking would give Britain a secure energy source without wrecking the environment.
It’s a familiar topic at The Right Side. Over the last few weeks there’s been a lot of debate over the pros and cons of the issue. I’d like to leave the subject behind for now, but not before going over what I’ve learned…
Your top three issues
Speaking as an investor and UK resident (one with young kids, to boot) I’m pretty much on the pro side of the debate too.
Don’t get me wrong, I’m concerned about environmental issues like many others. I mean, the last thing anyone wants to see is a catastrophe on our own doorstep.
Yet I’ve been quite surprised by how positive the feedback on this subject has been. I thought it would be much more controversial. You see, when an article generates a lot of response, it’s usually from readers who disagree with you. Basically, they write in to slate me (and I’m fine with that!). But that hasn’t been the case with fracking.
The more I read through reader comments, the more I think that the man on the street (or at least the average Right Side reader) has his finger on the pulse. Three issues came up again and again.
1) Any projects should be undertaken with the utmost of care and respect for the environment. Checks and balances must be in place.
2) Fracking should only happen as part of a sustainable energy policy. Fracking profits should be spent in part on renewable energy and energy saving measures.
3) We should regenerate business in old industrial areas which have suffered over recent decades.
And anyway, who is going to be the first to turn out the lights? And who wants to make the dreaded decision between ‘heat and eat’? Those are very real concerns amongst readers.
The cultural media blind spot
I think an elitist ‘cultural-media’ has emerged in the UK. What do I mean by that? I mean that much of the mainstream media supports the status quo. And I don’t think they represent the public.
Take, for example, the debate on immigration. For years, it was impossible to have a sensible debate on immigration because it was deemed undignified. That went on until UKIP forced the issue by themselves, without the media’s blessing. Now suddenly, all parties seem to be singing from the same populist hymn-sheet.
From what I can see, fracking strikes a similar chord. The cultural elite don’t even want to talk about it. You see plenty of stuff plastered over the media about the dangers of fracking – earthquakes, flames spouting from kitchen taps, talk of chemical cocktails pumped into the water supply. You know the stuff… it makes for a good read!
But among the rank and file, people seem much more open to rational debate. Many people see that in reality, there’s a lot be said for making the most of our naturally occurring fossil fuel.
I don’t see the ‘cultural media’ changing its opinion any time soon. But I suspect that ten years from now, today’s horror stories will be very much put in context.
And while the anti-fracking lobby remains so entrenched, it does at least offer early investors the chance to get in on theme that most investors choose to ignore. That’s the investment opportunity. For all the information you need to make that investment decision, click here.
Where to go from here
There are, of course, many reasons to tread carefully. In investment, there’s only one thing worse than being wrong… and that is, being right, but too soon!
In that sense, I’ve kicked off with quite a small exposure to the sector. The big oil majors are already muscling in on the action, so I had some exposure through them. I’ve also been looking at a couple of dedicated fracking companies. These boys could offer early bird investors a very healthy gain – but they’re risky!
I’ve also mentioned Wood Group before. It’s a Scottish oil services company that has been expanding its fracking technical base. As and when things kick off in the UK, they should be very well placed to pick up contracts.
For the moment, I’m starting off carefully. But it’ll sure be interesting to see how this game develops.
Former City fund manager comes forward with:
“My top UK fracking investments for 2014”
This year, shale gas – and the controversial drilling method known as ‘fracking’ – could go mainstream in Britain.
Huge amounts of wealth stand to be made if you make the right investment.