Addressing the World Economic Forum in Davos, the Prime Minister said the development of “cheap and predictable” energy sources could help to reverse the “off-shoring” of European jobs to the rising economic powers of Asia where labour costs are lower.
But he warned that the opportunities presented by shale gas – which had helped transform the US economy - could be undermined if the European Union sought to impose unnecessary new regulations.
“To relocate in Europe, businesses will be encouraged by cheap and predictable sources of energy,” he said.
“We should be clear that if the European Union or its member states impose burdensome, unjustified or premature regulatory burdens on shale gas exploration in Europe investors will quickly head elsewhere.
“Oil and gas will still be plentifully produced, but Europe will be dry.”
Mr Cameron acknowledged there were genuine concerns about fracking, but insisted that if it was done properly, it could have significant benefits both for the economy and the environment.
“We need the right regulations – such as ensuring that well casings are set at the right depths with tight seals. And governments need to reassure people that nothing would go ahead if there were environmental dangers.
“But if this is done properly, shale gas can actually have lower emissions than imported gas.”
He was scathing about the tendency of Brussels to produce “incredibly complex and overwritten directives” which deterred business from investing in the EU and creating jobs.
And he attacked those in the EU who, he said, believe it is their job to create new regulations.