Fracking may be impractical in parts of the UK due to the scarcity of local water supplies, and in other areas will have an impact on local water resources, the water industry has admitted, in a deal struck with the oil and gas industry.

The controversial process of shale gas and oil extraction uses hydraulic fracturing technology or fracking, where water and chemicals under very high pressure are blasted at dense shale rocks, opening up fissures through which the tiny bubbles of methane can be released.

But the quantities of water required are very large, leading to cases in the US - where fracking is widespread - where towns and villages have run dry.

In a memorandum of understanding published on Wednesday, the water trade body Water UK and the UK Onshore Operators Group (UKOOG), which represents fracking companies, agreed to cooperate on expanding the number of fracking sites in the UK.

But in their agreement, noting "the pressure on local water resources", Water UK acknowledged: "The quantities of water needed vary by site and throughout the gas exploration and production process, but the demand could have an impact on local water resources. This demand may be met from a number of sources, including the public water supply, direct abstraction, water transported by tanker from other areas, or recycling and reuse of treated flowback or produced water."

They added: "However, where water is in short supply there may not be enough available from public water supplies or the environment to meet the requirements for hydraulic fracturing."

Water can be brought in from other areas, but this is costly, causes a nuisance to residents, and in large quantities would be impractical. It may be possible to use seawater in some areas. UKOOG said dealing with such issues was one of the purposes of the memorandum. Water UK told the Guardian there could be risks to the water supply particularly in the south-east, where the pressure of population puts supplies under stress.

The Environment Agency admitted at a public meeting in Balcombe in Sussex – where the fracking company Cuadrilla has been drilling for oil – that pressure on local water supplies could raise serious problems. An official told local residents: "The big question mark is over cumulative demand for water in the south-east should this industry take on a much bigger size."

Ken Cronin, chief executive of UKOOG, said the agreement with the water industry "should give reassurance to local communities that the development of shale gas in the UK can proceed with minimal impact upon the local water and waste services".

But the potential need to abstract water from underground sources or rivers has raised concerns. The new water bill is likely to lead to a large increase in the amount of water taken by water companies from rivers and streams, and has been criticised by campaigners for enshrining very lax controls on how much they can take. This could lead to water courses running dry, with dire effects on wildlife. If water companies are under pressure to supply more for fracking, this could put even more pressure on resources.

Tony Bosworth, energy campaigner at Friends of the Earth, said: "This new industry report raises concerns about the impact fracking could pose to water-stressed southern England. Draft guidance from the Environment Agency is full of holes and doesn't adequately address the risks to water supply and quality. The desperate search for shale gas and oil must not be allowed to cause water shortages for critical public purposes, and increases in hosepipe bans."

The fracking industry's deal with water utilities comes as iGas, which along with Cuadrilla is one of the few companies with plans for fracking in the UK, unveiled details of proposed drilling at its Barton Moss site, near Manchester. The company now has planning permission from Salford council, at a site about the size of a football pitch, where a vertical exploration well will be drilled, taking about eight to 12 weeks. No fracking will take place in the initial phase, as engineers will take samples for analysis to discover whether fracking might be necessary to recover any gas found.

A small protest is taking place at the site, with protesters from Frack Free Greater Manchester staying in tents, near Barton aerodrome and the M62 motorway. The BBC reported on Tuesday that a man had been arrested on suspicion of causing an obstruction, as the drilling rig arrived at the site. © Guardian News and Media 2013

[Image via AFP]