The British Gas owner Centrica is in talks with Britain's leading fracking company about buying a stake in its most promising acreage just months after playing down the prospects for shale gas.
Sources have confirmed to the Guardian that discussions are ongoing between Cuadrilla Resources and Centrica over the sale of a stake in the Bowland shale in the north-west of England.
A second shale operator, IGas, said earlier this week that estimates of its resources were considerably higher than previously thought and that it could meet gas consumption in Britain for decades. Yet Centrica insisted in January that shale gas was not "the game-changer we've seen in North America" and has played down speculation that it might start drilling.
Centrica refused to comment but sources said negotiations with Cuadrilla and its existing shareholders AJ Lucas, an Australian mining firm, and Riverstone Holdings, a private equity group where former BP boss Lord Browne is a director, were at an advanced stage. A firm deal could be struck within weeks.
The entrance of a major name such as Centrica into the British shale sector would come as an enormous shot in the arm to what has until now been a cottage industry made up of relatively small companies. Centrica would bring cash, huge operational experience and a major brand name and domestic supplier in British Gas.
Such a move could put Centrica at the centre of any "shale gas revolution" of the kind seen in the US – but it would also bring further reputational risks for a member of the Big Six that is already a target for a wide variety of critics. Many environmentalists are opposed to fracking on the grounds that a cocktail of chemicals are used to break up the shale rock and extract the gas.
