The UK government plans to introduce new environmental guidelines for oil and gas companies operating in the North Sea following a landmark Supreme Court ruling that requires regulators to take Scope 3 emissions into account when approving future projects.
Britain’s Supreme Court ruled in June that a local council had unlawfully approved an onshore oil drilling project because planners had to take into account emissions from future use of oil as a fuel, a landmark case that could disrupt plans for new oil and gas projects in the UK.
“It is agreed that if the project proceeds, it is not only likely but inevitable that the oil produced from the wells will be refined and ultimately burned as a final product, and that such combustion will generate greenhouse gas emissions,” the judges wrote in their ruling.
In light of the ruling, the Labor government announced on Thursday that it plans to introduce new environmental guidelines for oil and gas companies, which the cabinet said would help “provide stability for industry, support investment, protect jobs, deliver economic growth and meet its climate obligations as the North Sea transitions to a clean energy future.”
Energy Minister Michael Shanks said:
“We will consult on new guidelines in due course that take into account the Supreme Court’s ruling on environmental impact assessments, allowing industry to plan, safeguard jobs and invest in our economy.”
While planning new environmental guidelines to provide certainty for the industry, the government also said in the same communication that it would not contest the judicial review of the development permits for the Jackdaw and Rosebank oil and gas fields in the North Sea, creating more uncertainty for the projects that have already been granted permits.
Climate groups Greenpeace and Uplift have filed a lawsuit seeking a judicial review to stop the development of Rosebank and Jackdaw.
Earlier this week, Rosebank operator Equinor said it was waiting for clarity on the tax regime from Britain’s Labour government before setting out a strategy and committing to investments in the UK North Sea.
By Charles Kennedy, Oilprice.com
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