UK Shale Gas Resurgence: Reform UK's Policy Push and the Energy Stocks Poised to Benefit

The UK's energy landscape is on the brink of a seismic shift. Reform UK, led by Nigel Farage and backed by a coalition of industry advocates, is championing a bold policy agenda to revive shale gas extraction through fracking. This move, framed as a solution to energy insecurity and economic stagnation, has sparked renewed interest in energy infrastructure stocks. For investors, the interplay of political momentum, regulatory uncertainty, and market dynamics presents both opportunities and risks.

Reform UK's Fracking Agenda: A Strategic Play for Energy Independence

Reform UK's energy policy, spearheaded by deputy leader Richard Tice, centers on two pillars: lifting the current moratorium on fracking and creating a regulatory framework to attract private investment. The party argues that the UK's untapped shale gas reserves—estimated at hundreds of billions of pounds in value—could reduce reliance on foreign imports, stabilize energy prices, and create hundreds of thousands of jobs. Tice's mantra, “Don't write off Britain,” underscores a belief that domestic energy production is key to insulating the UK from global market volatility.

The British Geological Survey (BGS) has identified four regions with potential for commercial shale gas, including the Gainsborough Trough in Lincolnshire and parts of Lancashire. However, the BGS also cautions that UK conditions are far less favorable than in the U.S., with complex geology and high extraction costs. Despite these challenges, Reform UK insists that exploratory drilling at a few independently monitored sites could yield results within two years, potentially validating the economic and technical viability of UK shale gas.

Energy Stocks in the Crosshairs: Egdon Resources and Star Energy Group

Two firms at the forefront of this potential revival are Egdon Resources PLC (STU:4ED) and Star Energy Group Plc (STAR). Both have been actively engaging with Reform UK officials and preparing for a regulatory shift.

Egdon Resources holds a key exploration license in the Gainsborough Trough, a site it estimates could be worth £140 billion to the UK economy. The company's recent stock performance reflects its strategic positioning: after a decline to €6.19 million in July 2022, Egdon's shares rebounded to €19.75 million by January 2023. This recovery aligns with its progress on conventional projects like the Wressle Oil Field, where production began in early 2021. However, its unconventional shale gas initiatives remain stalled by the current moratorium. A Reform UK government could unlock these assets, making Egdon a prime candidate for near-term gains.

Star Energy Group, meanwhile, has diversified into geothermal energy while maintaining a focus on onshore oil and gas. Its recent acquisition of a Croatian project developer in 2023 highlights a strategic pivot toward renewables, but the company has not ruled out shale gas as a transitional resource. Star Energy's stock, trading near its 52-week low of £6.00 as of August 2025, reflects its financial challenges, including a net loss of £11.295 million in the trailing twelve months. Yet, its 39.1% gross profit margin and EBITDA of £5.78 million suggest underlying operational resilience.

The Political and Regulatory Tightrope

While Reform UK's optimism is palpable, the path to a shale gas revival is fraught with obstacles. The current Labour government has committed £28 billion annually to green energy and a permanent ban on fracking. Energy Minister Miatta Fahnbulleh's vision of a “clean energy superpower” contrasts sharply with Reform UK's fossil fuel-centric approach. Public opposition, environmental litigation, and the legacy of past failures—such as Liz Truss's short-lived 2022 policy reversal—add layers of uncertainty.

Investors must also consider the National Security and Investment Act (NSIA), which imposes stringent scrutiny on energy sector transactions. Even if Reform UK succeeds in lifting the moratorium, foreign and domestic investors will need to navigate a complex regulatory maze.

Investment Implications: Balancing Risk and Reward

For those willing to bet on Reform UK's agenda, the energy infrastructure sector offers compelling opportunities. Egdon Resources and Star Energy Group are already positioned to benefit from a policy shift, with Egdon's Gainsborough Trough and Star's geothermal expansion representing dual avenues for growth. However, the risks are significant:

1. Political Uncertainty: A Reform UK government is not guaranteed. Labour's clean energy transition and public sentiment against fracking could delay or derail shale gas projects.
2. Technical and Economic Hurdles: The BGS's warnings about UK geology and extraction costs cannot be ignored. High capital expenditures and low returns could deter private investors.
3. Environmental and Social Risks: Protests, legal challenges, and reputational damage from seismic events (e.g., the 2011 Lancashire earthquakes) remain persistent threats.

A diversified approach is advisable. Investors might consider pairing exposure to shale-focused firms like Egdon with renewable energy players to hedge against regulatory shifts. For example, Star Energy's geothermal projects could provide a buffer if fracking faces prolonged opposition.

Conclusion: A High-Stakes Gamble with Long-Term Potential

Reform UK's push for shale gas revival is a high-stakes gamble with the potential to reshape the UK's energy infrastructure. While the political and technical challenges are formidable, the economic incentives—energy security, job creation, and reduced import dependence—are equally compelling. For investors, the key lies in balancing optimism with caution. Energy stocks like Egdon and Star Energy offer exposure to a sector poised for disruption, but their success will depend on the alignment of policy, public opinion, and market forces.

As the 2025 general election approaches, the UK's energy future hangs in the balance. Those who act now may find themselves at the forefront of a new era—or left scrambling as the tectonic plates of policy and politics shift once more.