Approving the Jackdaw gas field would be “a hugely important vote of confidence in the North Sea”, business leaders say.
It has been reported Jackdaw will be given the green light by the government as early as next week. But Jackdaw must not be “the end of the story” and drilling must also go ahead at Rosebank, Britain’s largest untapped oil field, said Russell Borthwick, head of the Aberdeen & Grampain Chamber of Commerce.
He also called for an end to the energy profits levy, or windfall tax, which has been blamed for driving away North Sea investment. Together, these moves would “send a powerful signal that Britain is serious about backing its energy workers, its industrial base and its own energy security”, he said.
Work at both Rosebank and Jackdaw has been paused after a legal challenge on climate grounds. The Government will take the final decision on whether it can restart and decisions are expected this month.
Sources have told the BBC Jackdaw is likely to be approved, with the move announced in mid-September. This would come ahead of Andy Burnham’s planned visit to Aberdeen.
The Guardian has reported approval for Rosebank could follow. It claims officials are looking into ways of ensuring that proceeds from the oil field go towards clean energy projects.
Although their analysis of the environmental impact has not been finished, “some close to the process believe they will soon decide the project should be approved”, the paper states. The AGCC says a timely approval for Jackdaw would mean it could begin supplying gas to UK homes this winter.
Mr Borthwick said: “Approval of Jackdaw would be a hugely important vote of confidence in the North Sea, protecting jobs, strengthening our energy security and ensuring more of the oil and gas we still need is produced here in the UK. But Jackdaw cannot be the end of the story. The same urgency must now be applied to Rosebank, another major project capable of supporting thousands of jobs, billions of pounds of economic activity and significant tax revenues for the Treasury.
Labour is set to approve Jackdaw | GETTY
“Together these projects represent 10 per cent of our future gas supply at a point where we face a critical gas shortage. The Prime Minister has rightly called for a pragmatic approach to domestic oil and gas.
“Swift approval of both Jackdaw and Rosebank would put those words into action, but we also need the Government to address the punitive tax regime which is driving investment and jobs out of the North Sea. That means ending the Energy Profits Levy at the start of the new tax year and moving to the permanent, price-based Oil and Gas Revenue Levy.”
Conservative leader Kemi Badenoch backed drilling, saying that importing fuel was worse for the planet. She said: “Not drilling Jackdaw and Rosebank is actually increasing carbon emissions because we’re not using oil and gas that’s drilled cleanly in our country; instead, we’re importing it from other places that drill it dirty.
“So we haven’t lowered carbon emissions. We just send them somewhere else and increase them.
“That is one of the things that is not helping with reducing carbon emissions. If we want to tackle climate change, we need a climate plan that actually works, not just one that says net zero but doesn’t do things the things that it’s meant to do for the world.”
Andrew Bowie, the Tory shadow energy secretary, said approving the Jackdaw gas field was “common sense”. “Labour’s ban on new oil and gas licences has been disastrous for the North East and cost thousands of workers their jobs as they continue to dither over a decision,” he said.
But Friends of the Earth Scotland said the UK Government must not “cave in to fossil fuel company pressure”. The group warned the burning of more fossil fuels would worsen extreme climate change-related events such as heatwaves.
The Department for Energy Security and Net Zero said it does not comment on speculation. A spokesman said: “The North Sea remains a vital national asset and 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.
“Any decision will take into account all relevant evidence, including environmental assessments and public representations received during the consultation process.”