Prime Minister Andy Burnham is facing a significant climate test with decisions looming on the Jackdaw and Rosebank North Sea oil and gas projects. While a public consultation on Rosebank recently concluded, the review for Jackdaw has also finished. Both projects are required to re-apply for development consent after a court ruling. The decision is politically sensitive given Labour's pre-2024 pledge not to approve new North Sea drilling permits, despite Burnham's recent pragmatic stance on utilizing existing oil and gas resources.
Jackdaw, located about 150 miles east of Aberdeen, is a gas field whose operators believe could be connected to the UK network within months. Rosebank, about 80 miles northwest of Shetland, is Britain's largest untapped oil field, also producing some gas, and is projected to be operational by 2027 if approved. Adura, a joint venture between Equinor and Shell, operates both fields, with Ithaca also holding a 20% stake in Rosebank. Adura claims $3.8 billion has already been invested across both projects.
From an economic perspective, Jackdaw is seen as having its infrastructure largely in place, with wells drilled, enabling a quicker startup. It could produce enough gas to power 1.4 million homes, meeting about 2% of UK gas demand, potentially reducing LNG imports. However, the impact on UK energy prices would likely be limited due to global market exposure. Rosebank, if approved, is expected to yield up to 500 million barrels of oil over 25 years. Most of this oil would be processed in the Netherlands as UK refineries cannot handle the crude type, with refined products potentially reimported. Industry body Offshore Energies UK (OEUK) estimates the fields would support over 3,500 construction jobs, 880 jobs during their lifespan with an average salary of $85,850, and generate $1.4 billion in tax revenues by 2029, rising to $3.8 billion by 2034.
However, environmental concerns are substantial. Jackdaw is estimated to produce 35.8 million tonnes of carbon over its 11-year lifetime (or Adura's estimate of 23.6 million tonnes), while Rosebank is projected to generate almost 250 million tonnes of planet-warming emissions. An analysis suggests the climate damage from these projects could amount to $119 billion to $336 billion, significantly outweighing Adura's estimated $28.7 billion economic value to the UK. While Adura argues Jackdaw's emissions would not "materially influence" global warming and displacing imported LNG would save 4 million tonnes of CO2, critics contend this merely shifts emissions globally. The International Energy Agency's Fatih Birol also noted that new North Sea drilling wouldn't significantly enhance UK energy security or reduce bills.
