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The Minister will consider the economic benefits of North Sea oil and gas projects, along with carbon “removal” activities, when deciding whether to grant consent under guidance designed to overturn approval.
The new guidance issued Thursday has hampered British authorities by failing to weigh the climate impact of fossil fuel burning when issuing consent for development in the North Sea after a groundbreaking court ruling last year.
According to the guidance, the energy secretary will assess such effects, called downstream emissions, by considering the government’s “overall energy and environmental goals, as well as the potential economic and other benefits of the project.”
The document also added proposals by companies to mitigate the impact of carbon, such as investing in carbon dioxide “removal” projects when governments agree to the regulations on development.
The language could be useful for two vast oil and gas fields developed by Shell and Equiner, who were bored last year, as downstream emissions were not taken into consideration.
The decision should take into account the carbon dioxide released when consumers burn the oil and gas produced, authorities lay tests prepared in a Supreme Court case known as Finch.
Shell and Equiner are expected to reapply for their respective Jackdaw and Rosebank projects in the wake of new guidance.
The project is set up by the Kiel Ir Starmer government for clashes with climate activists and threatens to endanger tightrope walking approaches to oil and gas in the North Sea.
The Prime Minister wants to move away from fossil fuels and plans to not issue licenses for new oil and gas exploration in the North Sea, but has said his government will not hinder existing licenses.
Jackdaw and Rosebank were awarded licenses and consent before Labour was elected in July 2024, but some campaigners believe the government should refuse to reapply for consent given the project’s carbon emissions.
Priority Prime Minister Rachel Reeves has both shown support for the project. Reeves told Sun in a Sunday newspaper in March. “We said in our manifesto they would go on and respect the existing licenses.
Rosebank is the UK’s largest undeveloped oil reserve and is believed to contain 500mn barrels of oil. Energy Secretary Ed Miliband in 2023 – when Labour opposed – the license issued to Rosebank described as “a huge waste of taxpayer money and climate vandalism.”
Greenpeace UK climate director Mel Evans said the project should also be blocked under new guidance, but warned that factoring carbon removal measures risks creating “dangerous loopholes.”
“Rosebank and other drilling sites should fail the standards established by the Minister because they have little benefit to the economy and provide no help to claimants,” she said.
Evans added: “Ed Miliband was right to say that approving Rosebank is climate destructive. He should remain true to his words.”
Rosebank said it is reviewing the guidance and is working on moving forward with the project. Shell said he had spent £800 million developing Jack Deaux so far and was committed to seeing it again. The project “supports the government’s growth agenda.”
Under the new guidance, developers should set how emissions from product combustion affect global carbon budgets, including potential cumulative effects when considered along with other developments.
The guidance does not recommend any specific measures to mitigate emissions, but the current view of the regulator is that it “is currently the most appropriate.”
Carbon can be removed from the atmosphere by direct air capture or planting. The guidance did not specify which removal measures were best.
The guidance adds that it is “impossible” for drillers to provide carbon reduction credits purchased from others in mitigation for their own emissions.
Energy Minister Michael Shanks said the guidance “along with science, ensuring management, prosperity and an orderly transition to a clean energy future in the North Sea.”
