A CONTROVERSIAL new industry earmarked for the edge of Liverpool is backed by MPs today – despite being linked to polluted tap water and fears of gas explosions in the USA.

The Government is urged to give the go-ahead to "shale" gas drilling, with a prediction it could be worth £28bn and cut Britain's dependence on imported gas.

The recommendation comes just months after a company revealed huge untapped reserves are trapped in rocks beneath Wirral, North Cheshire and North Wales.

IGas said it hoped to exploit a string of licence areas around Liverpool, including exploration blocks beneath John Lennon Airport, Widnes and Warrington.

But the process is hugely controversial, because it involves pumping chemicals underground at high pressures to fracture the rock and release gas, a process known as "fracking".

In America, residents of a number of towns close to shale gas drilling locations complained their tap water turned cloudy and gassy – and could even be ignited. A film, called Gaslands, was nominated for an Oscar after people were shown setting fire to water heavily contaminated with methane, raising fears of explosions.

It was also alleged that gas companies were trucking in drinking water to residents, in return for them signing non-disclosure agreements.

But, in a report published today, the all-party energy and climate change committee said it had found no evidence that “fracking” posed any risk to water supplies.