Britain needs a new regulator for onshore underground energy and shale gas companies must engage with local communities more effectively before a UK shale gas industry can be developed, a task force examining the sector said on Wednesday.

Several companies plan to explore for shale gas in Britain using hydraulic fracturing, known as fracking, which injects water, sand and chemicals into rocks to release hydrocarbons.

However, there is considerable local opposition to the process due to concerns about noise and environmental damage. The Task Force on Shale Gas was set up last year to examine the risks and benefits of shale gas extraction and says it is independent of its funders -- Cuadrilla Resources, Centrica , Total, Weir Group, Dow Chemical and GDF Suez E&P UK. It published an interim report on Wednesday looking at local engagement, planning and regulation issues.

There will be three more reports this year covering environment, climate change and economics before final conclusions next year. The report recommended that a new regulator for onshore underground energy, which includes shale oil and gas, should be created to take over responsibilities currently split between various agencies and government departments.

"We believe the creation of a new, bespoke regulator for onshore underground energy would command more public confidence for ensuring proper monitoring and regulation of any proposed shale gas industry," said Chris Smith, chair of the Task Force on Shale Gas and former chair of the Environment Agency.