Ministers are poised to approve a controversial new gasfield in the North Sea this month, according to government sources, and are considering approving a major oilfield later this year.
Miatta Fahnbulleh, the energy secretary, will give her recommendation to approve the Jackdaw field off the coast of Aberdeen as soon as next week, according to people close to the decision, and the formal approval could follow a week after.
Meanwhile, officials are looking for ways to make sure any proceeds from the separate Rosebank project – if it is approved – go towards clean energy projects, as happens in Norway.
Officials have not yet finished their analysis of Rosebank’s environmental impact, but some close to the process believe they will soon decide the project should be approved.
Both projects have become emblematic of the government’s commitment to the North Sea, with green campaigners calling for them to be abandoned while the US president, Donald Trump, urges the prime minister to open them up.
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.”
Consultations on both Jackdaw and Rosebank, which the industry says will provide 10% of the UK’s oil and gas output at their peak, closed last month, since when Fahnbulleh has been considering her response.
Campaigners say the fields would produce as much as £336bn worth of damage to the economy as a result of the carbon pollution from the oil and gas that are produced.
Both fields have licences to operate, but environmental approval was rescinded after a judge ruled the companies running them – Shell and the Norwegian company Equinor – needed to account for the carbon emissions that would be produced by burning the oil and gas they produce.
The companies resubmitted their applications for environmental approval earlier this year. Granting those environmental permits would not violate Labour’s manifesto commitment not to issue new oil or gas licences, but many of the party’s MPs are opposed to the projects entirely.
Since he entered Downing Street, Andy Burnham has signalled he has concerns about the way in which the move 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.”
Officials stress final decisions have not been made for either Jackdaw or Rosebank, but those close to the process say Fahnbulleh is likely to signal her approval for Jackdaw as soon as Monday.
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She will give her recommendation to the North Sea Transition Authority, which officials hope will issue the formal approval as soon as a week afterwards. Some in government think the NSTA process could take several weeks, however.
A decision on the £8.7bn Rosebank field, which is the biggest undeveloped field in UK waters and is estimated to contain as much as 500m barrels of oil or oil equivalent, is likely to come later in the year.
Fahnbulleh is likely approve that project if the environmental impact assessment allows it, according to sources, but is looking at ways to redirect the proceeds from it to clean energy projects in the UK. One option would be to put the tax revenues from the project into the national wealth fund, which has been set up to fund green energy schemes and other infrastructure projects.
Some in government warn this will be difficult, though, because the consenting process is already advanced and it could prove legally complex to change the terms on which the project is approved. The money has also already been accounted for in the Treasury’s forecasts, given the projects have their licences, meaning the chancellor, John Healey, would have to redirect it from other parts of government spending.
