Britain's IGas receives approval for shale gas exploration permit

LONDON, Nov 15 (Reuters) - Nottinghamshire County Council gave the green light on Tuesday for shale gas developer IGas to test drill a shale gas site in northeast England in a first sign from the local authority that it supports shale gas projects.

IGas' shares surged by more than a fifth to trade at a one-month high of 13.40 pence following the news.

Subject to a legal agreement, IGas will now be allowed to carry out exploration work at its Springs Road site in North Nottinghamshire close the city of Sheffield in order to test whether the shale rock present is suitable for fracking.

The company will have to apply for a separate permit to carry out fracking work, a process whereby water, sand and chemicals are injected to open up the shale rocks and release the trapped gas.

"At this stage we are trying to establish if the significant quantities of gas that we have identified exist in the right formations to be commercially prospective," said IGas Chief Executive Stephen Bowler in a statement.

Nottinghamshire County Council councillors voted seven to four in favour of the application, a spokesman said.

Britain is estimated to have enough shale gas trapped below its surface to meet its gas needs for decades but the use of fracking is opposed by environmental campaigners who are concerned about its impact on groundwater and seismic movements.

Britain's shale gas industry is still in its infancy, with the country's second shale gas fracking permit awarded only last month.

(Reporting by Karolin Schaps)