Osborne told the House of Lords Economic Affairs Committee that drilling for shale gas would swell the Treasury’s tax receipts and would boost the British economy.
But he played down suggestions that the fledgling industry could have a drastic effect on household gas bills.
Osborne said that the effect on gas prices in the UK would be less dramatic than in the United States, where the cost of gas has fallen by some 40%.
The Chancellor said:
“I think it will have an impact [on prices]. I hope it will have a significant impact.
“I think in the UK there are some differences with the US. We are not as closed an energy economy as the US is. So I think we more closely track the worldwide gas price than the US does and we have less ability to detach ourselves from the worldwide gas price.”
“I am very pro this development and I think it does have the potential to bring gas prices down in the UK. I just don’t want to over-promise. I don’t want to go out there and say this is the solution to all of this country’s economic problems.”