Energy Secretary Miatta Fahnbulleh is likely to reject the Rosebank oilfield, sources say, a decision that would mark a significant shift in UK North Sea policy. The Guardian understands that officials believe she is minded to refuse the project, which would be one of the biggest oilfields in the North Sea.
Fahnbulleh approved the Jackdaw gasfield on Wednesday, prompting criticism from some environmental groups. However, she explained that the rationale for Jackdaw does not apply to Rosebank. "One is a gasfield that caters for the domestic market, while the other is an oilfield that is mainly for export," she said. "It is right that we judge each application in its own right, and it is absolutely critical that the decision is consistent with our climate obligations, our carbon budgets and the end destination we need to get to with the energy transition."
The Jackdaw field, due to begin producing gas within weeks, is expected to add 36 million tonnes of carbon emissions. Fahnbulleh said she is satisfied that Jackdaw does not violate the UK's climate commitments. "As we make the transition, we are going to need gas," she said during a visit to Aberdeen. "At a point when we have got conflict in the Middle East that is triggering an energy crisis, energy security is vital, and homegrown energy is key." She conceded the decision would not help reduce household energy bills, stating: "This is not about bills."
Rosebank would emit about seven times the carbon of Jackdaw and, officials say, would contribute less to UK energy security because most of its oil would be exported. A final ruling on Rosebank is expected later this year.
Neil McCulloch, chief executive of Adura, one of the companies behind Rosebank, expressed optimism about the project's prospects. "We've seen a decision made that there is a process that can result in a decision, but it's a matter for the secretary of state and her team to examine the two fields separately," he said. "But we believe we've done as good a job in arguing our case with Rosebank as we did with Jackdaw. Obviously, the economic benefits of Rosebank are different. It's a bigger field. It will last longer than Jackdaw, and so I'm sure she'll take that into account when she makes her decision in terms of the jobs and economic impact for the UK."
Fahnbulleh has promised that future North Sea tax revenues will be invested in a new energy wealth fund for green projects, with GBP 2 billion allocated in the upcoming budget. She said: "When we have tax revenues that are coming from the oil and gas industry, it is right that we invest that in the transition we need to make in energy." However, she did not specify which tax revenues would go to the fund or how much it might generate, saying the chancellor would provide details in the budget.
The Labour government's 2024 election manifesto pledged a ban on new drilling licences, but the companies behind Jackdaw and Rosebank sought approval for existing licences. A Savanta poll for climate group E3G, seen by the Guardian, found that nearly a third of voters would be less likely to vote Labour if it approved more North Sea drilling, including about a third of 2024 Labour voters and half of 18- to 24-year-olds.