Britain's hopes of expanding its shale gas industry suffered a blow Monday when local authorities rejected plans for an exploratory fracking site in northwest England following protests.

The application by energy firm Cuadrilla to begin fracking in Lancashire had met fierce resistance from environmental campaigners and local residents, who cheered Monday's decision when it was announced at a local council meeting.

Cuadrilla said it was "surprised and disappointed" and was considering appealing the ruling, which follows the rejection last week of its plans to frack at another site in the area.

"We remain committed to the responsible exploration of the huge quantity of natural gas locked up in the shale rock deep underneath Lancashire," the firm said in a statement.

Cuadrilla had hoped to drill four wells and undertake exploratory drilling for shale gas at a site in Little Plumpton, a small village close to the coastal town of Blackpool.

But Lancashire county councillors voted against the proposals, on the grounds of their impact on the landscape and noise, despite recommendations by planning officers to approve the plans.

The application, including a 4,000 page environmental statement, had undergone intense scrutiny and public consultation since being submitted more than a year ago.

The outcome is a setback for Prime Minister David Cameron's government which has pledged to go "all out for shale", claiming it would increase energy security, keep prices down and create jobs.

Cameron hopes to replicate the success of the US fracking industry but has faced opposition protests in many parts of the country.

Opponents fear that the process -- which involves pumping water, chemicals and sand at high pressure underground to extract gas -- would pollute water supplies, scar the countryside, and trigger earthquakes.

Fracking campaigners outside Preston town hall celebrated in the streets when they heard Monday's decision, chanting "Frack Free Lancashire" and uncorking bottles of champagne.

Greenpeace UK energy and climate campaigner Daisy Sands said: "This decision is a Waterloo for the fracking industry and a triumph for local democracy. It's also a huge boost for efforts to kick the UK's addiction to dangerous fossil fuels."