Santander withdraws mortgage offer over Balcombe drill site
- 23 October 2013
- From the section Sussex
A bank's mortgage offer for a house was initially withdrawn due to its valuer being "unable to assess the property's risk" from a West Sussex drill site.
Santander withdrew the offer for the house, 6 miles (9km) from the Balcombe site, following environmental searches.
Crawley MP Henry Smith raised the issue with Energy Minister Michael Fallon, who said there was "no reason" being near the site should affect offers.
After making a new offer, the bank said it reserved the right to amend offers.
The site saw test drilling for oil by energy firm Cuadrilla during the summer.
The tests brought protesters to the site, who feared the work could lead to hydraulic fracturing, or fracking, the process of extracting shale gas from deep underground.
Cuadrilla, which closed boreholes following the tests, said it had no plans to carry out the process at the site, but hoped to secure planning permission to carry out "flow tests" to determine the rate of extraction at the well.
'No impact whatsoever'
Mortgage advisor Michael Robinson, who made the application on the property in Pound Hill for a client, said that initially "everything went through totally satisfactory and we got an offer".
He said the offer was then withdrawn after solicitors acting for the client raised inquiries regarding environmental searches and the valuer said there was a lack of information on the potential effects of the work.
He said that as a result, his client got in touch with Mr Smith, who raised the issue with the energy minister during parliamentary questions on Friday.
The minister said there was "no reason to expect that any activities undertaken to extract shale gas will have any adverse effect on individuals' ability to secure a mortgage on properties nearby".
Mr Smith said that "potential shale-gas extraction sites cover most of the UK and operate at depths of about 4,000 feet, so there should be no impact whatsoever on mortgage lending, home insurance or anything connected to such issues".
Mr Robinson said that following Mr Fallon's statement, a new offer was made by the bank.
A Santander spokesman said the bank had "investigated the circumstances and will be contacting our customer in light of new findings".
"The conveyancer advised the valuer that the address had been identified on an environmental report as being 'on site' - within 1.8 km of a drill head on the Cuadrilla site at Balcombe.
"The valuer was unable to determine whether that meant the property would be physically affected by the construction of rigs or drill heads.
"The conveyancer advised the valuer that he had exhausted all lines of enquiry and could tell him nothing more."
He said that, as a result, "the valuer was unable to assess the property's risk or value".
He added that the bank had now "been able to determine that, although the property lies within an area which has been granted a licence for exploration, this does not mean that it will physically become a mine."