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New North Sea oil field set for approval ahead of COP26

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Harbour's chief executive said the tax all but "wiped out" the firm's profits in 2022
Harbour's chief executive said the tax all but "wiped out" the firm's profits in 2022

Ministers are reportedly preparing to approve a new oil and gas project in the North Sea despite growing opposition from environmental groups.

Independent exploratory firm Siccar Point has submitted plans to develop the Cambo heavy cruel field off the coast of the Shetland Islands, the Times reported.

The field is expected to produce 150m barrels of oil over its 25-year lifetime, with its first oil expected in 2025.

The investment decision, which industry regulator the Oil & Gas Authority (OGA) was due by the mid-2021, comes just months ahead of the COP26 climate conference in November.

It comes despite a recently launched plan cut emissions from the North Sea basin, which produces 3.5 per cent of the UK’s yearly greenhouse gases, by 60m tonnes – or 50 per cent – over the decade.

That plan – the North Sea transition deal – includes a new “climate checkpoint”, which enables ministers to check whether projects are “compatible with the UK’s climate change objectives”.

However, because the Cambo well was licensed for exploration in 2001 and 2004, it will not be subject to the checks, the Times said.

Green groups said approving the project would undermine the government’s climate change goals ahead of November’s summit.

Greenpeace said that it had written to the Department for Business, Energy and Industrial Strategy (BEIS) to object to the project.

“If the government were to approve this license it would represent a colossal failure of climate leadership in the year the UK hosts the COP26 climate conference”, it wrote, quoting a recent International Energy Agency (IEA) paper that said there is “no need for investment in new fossil fuel supply”.

Caroline Rance, from Friends of the Earth Scotland, said. “It is simply not compatible with the science to go ahead with exploiting these fields and the fact that it is even being considered shows the current system is not fit for purpose.”

A spokesman for the Department for Business, Energy and Industrial Strategy said: “We are working hard to drive down demand for fossil fuels but we also know there will continue to be ongoing demand for oil and gas over the coming years.”