CHANCELLOR George Osborne says Britain should be in favour of new forms of energy like fracking which could cut bills and carbon emissions and create jobs.

Mr Osborne, MP for Tatton, was responding to a request by the Guardian for a comment on the awarding of shale gas licences to chemicals company INEOS.

INEOS Upstream is to operate a licence to allow it to explore for oil or gas possibly trapped in commercially viable quantities below ground.

INEOS Upstream is part of INEOS, and INEOS Shale is the company’s shale gas operating business.

The company has been awarded ‘acreage’ in three main areas, Yorkshire, the East Midlands and Cheshire, the latter including Knutsford, Northwich and Winsford.

INEOS won 21 new shale gas licences in the final part of the Government’s 14th licensing round, and has committed itself to full consultation with local communities.

In addition it says it will share six per cent of revenues with homeowners, landowners and communities near its shale gas wells, four per cent to homeowners and landowners directly above wells and two per cent to wider communities.

Mr Osborne said: “Like lots of other countries, we in Britain should be in favour of new forms of energy like fracking that can lead to lower family bills, more jobs and lower carbon emissions for our environment.

“With our new wealth fund, I’ve also made sure the money raised in profits is spent to benefit our local communities, something that didn’t happen in the past.

“Before any fracking work can begin here in Cheshire there will need to be full checks to make sure it is safe and safeguards the environment.”

INEOS Shale CEO Gary Haywood said in a letter to Wincham Parish Council: “Our interest is focused on discovering whether gas can be produced from the shale layer of rock three to five kilometres below the surface.

“Any drilling or fracking operations to establish this would be subject to the normal planning process through the local planning authority, including extensive consultation with the community.”

He said in some areas the company would need to use ‘seismic data acquisition’, scanning of the subsurface, to understand the rock layers beneath the ground.

“We are also likely to submit a number of planning applications during 2016 with a view to drilling up to four vertical wells across both the Cheshire and East Midland basins in 2017, with the option to extend the wells horizontally and perform a fracking operation if the initial results are encouraging,” he said.

“Although seismic data acquisition does not require planning permission we feel it is important to inform communities about all our activities, and intend holding community exhibitions ahead of any seismic acquisition programme.”