AN energy firm planning to launch Ryedale's first fracking site has dismissed a Government report that said the controversial practice could reduce house prices by up to seven per cent.

Third Energy, which is to resubmit an application to North Yorkshire County Council to test a possible fracking site at Kirby Misperton, said the Department of Environment, Food and Rural Affairs report did not stand up to scrutiny.

The Government originally published "Shale Gas: Rural Economy Impacts", with several sections blanked out last summer, but has been forced to publish it in full by the Information Commissioner.

A Third Energy spokesman said the report included no new research and was a review of existing literature, much of it from North America, which has different laws than the UK.

He added: "The report does conclude the economic impacts would be mainly positive and the environmental impacts low or localised.”

The report says large numbers of rural communities may be affected by the expansion of shale gas activities, and warns of traffic congestion, and worse noise or air quality.

Previously redacted sections included a claim that house prices could fall by up to seven per cent in areas near shale gas exploration sites, while rents may increase due to additional demand from site workers and the supply chain.

It also suggested houses could face additional insurance costs to cover losses in the event of fracking explosions, while losses from tourists avoiding areas may be off-set by increased hospitality to new workers.

It states: "Shale gas development may transform a previously pristine and quiet natural region, bringing increased industrialisation."

A Defra spokesman said the paper was an early draft of an internal document, featured conclusions which amounted to unsubstantiated conjecture and that work on it had been discontinued.

Campaigners from Frack Free Ryedale said they were pleased the Government had bowed to pressure and released the full report.

He said: "The report confirms that fracking near your home would mean lower house prices, higher insurance premiums, health risks and environmental damage.

"The fact that the report confirmed that leakage of waste fluids could affect human health through polluted water or the consumption of contaminated agricultural products will do nothing to persuade farmers in Ryedale to allow fracking anywhere near their land."

Ryedale's newly-elected Conservative MP Kevin Hollinrake, who hosted a Parliament debate on fracking, said the report should allay a lot of fears.

The former estate agent said the house price threats could be mitigated, adding that the reality was not as bad as the fears.