UK energy secretary expected to recommend Jackdaw gasfield approval

Rosebank oilfield decision expected later this year

UK Energy Secretary Miatta Fahnbulleh is expected to recommend approval of the Jackdaw gasfield in the North Sea as soon as next week, according to people close to the decision. Formal approval from the North Sea Transition Authority could follow about a week after her recommendation, though some in government think the NSTA process could take several weeks.

The Jackdaw field lies off the coast of Aberdeen. Shell and the Norwegian company Equinor are the operators of the two fields. A separate decision on the £8.7bn Rosebank oilfield — estimated to contain as much as 500 million barrels of oil or oil equivalent — is expected later this year. Rosebank is the biggest undeveloped field in UK waters. Fahnbulleh is likely to approve Rosebank if its environmental impact assessment allows it, according to sources, while officials look for ways to redirect any proceeds toward UK clean-energy projects. The consultations on both Jackdaw and Rosebank closed last month, since when Fahnbulleh has been considering her response.

Both projects previously had environmental approval rescinded, after a judge ruled that Shell and Equinor needed to account for the carbon emissions produced by burning the oil and gas they extract. The companies resubmitted their environmental applications earlier this year. Campaigners say the fields would produce as much as £336 billion in economic damage from the carbon pollution associated with their output. The industry argues the fields would together provide 10 percent of the UK’s oil and gas output at peak.

Granting the environmental permits would not violate Labour’s manifesto commitment not to issue new oil or gas licences, because both fields already hold licences to operate. Many of the party’s MPs nevertheless oppose the projects entirely. Andy Burnham, who recently entered Downing Street, has signaled concerns about how the transition to green energy has affected workers in the north east of Scotland, telling MPs this week: “I know that people have struggled with the impact of transition.”

US President Donald Trump has urged the prime minister to open the fields. Both Jackdaw and Rosebank have become emblematic of the government’s commitment to the North Sea, with green campaigners calling for them to be abandoned.

Officials stress final decisions have not been made for either project. Fahnbulleh will give her recommendation to the North Sea Transition Authority, which officials hope will issue formal approval as soon as a week afterward.

For Rosebank, officials are examining ways to direct the project’s proceeds into clean-energy investment. One option under consideration would place tax revenues from Rosebank into the national wealth fund, which has been established to finance green-energy schemes and other infrastructure. Some in government warn that altering Rosebank’s consenting terms could prove legally complex because the process is already advanced, and that the project’s revenues have already been incorporated into Treasury forecasts under Chancellor John Healey — meaning any redirection would have to come at the expense of other government spending.

A spokesperson for the energy department said: “The North Sea remains a vital national asset, supporting jobs, growth and the UK’s energy security. We are clear that oil and gas will continue to play an important role in our energy system for decades to come, alongside transitioning to clean power to protect jobs and tackle the climate crisis.”