Major North Sea projects thrown into doubt after court ruling

Two of the UK’s largest new oil and gas projects are in the hands of energy secretary Ed Miliband, after a judge in Scotland’s Court of Session backed Greenpeace and fellow environmental advocate Uplift’s argument that the permits granted to the oil and gas fields were unlawful.

While the permits have been cancelled, work will continue while the government considers re-issuing green lights to the projects. 

Jackdaw, owned by Shell (SHEL), and Rosebank, owned by Equinor (NO:EQNR) and Ithaca Energy (ITH), are the two largest development projects in the UK. Jackdaw had its environmental permit approved in 2022 and Rosebank got the nod in 2023. 

The oil companies, green groups and the government all agreed the permits were issued unlawfully when arguing the case in November, given the English Supreme Court decision from earlier last year that scope 3, or downstream, emissions should be considered by a secretary of state before granting environmental permits. That case was focused on the Horse Hill project in Surrey, owned by UK Oil & Gas (UKOG). 

The judge, Lord Ericht, had the choice of cancelling the permits or allowing them to stand. “The public interest in authorities acting lawfully and the private interest of members of the public in climate change outweigh the private interest of the developers,” he said. "The factors advanced by Shell, Equinor and Ithaca in respect of their private interest do not justify the departure on equitable grounds from the normal remedy of reduction [overturning] of an unlawful decision."  

Miliband has previously spoken out against new North Sea oil and gas projects. The government is in the midst of a consultation over how to include downstream emissions, which come from burning the oil and gas extracted from the North Sea. This will only be finished in the spring, so Shell, Equinor and Ithaca could remain in limbo for months. 

Shell told the court cancelling Jackdaw completely would cost around £350mn, while a 12-month suspension of development would cost £200mn. 

Uplift executive director Tessa Khan said the judgment was a “significant win which means that Rosebank cannot go ahead without accounting for its enormous climate harm”. Equinor also took the ruling as a win. “We welcome today’s ruling and are pleased with the outcome which allows us to continue with progressing the Rosebank project while we await new consents," the company said.