UK Government Weighs Climate Argument in North Sea Oil Debate

When ministers defend the government's position against new North Sea drilling, they have typically relied on two arguments. The first is that oil and gas prices are set on global markets regardless of UK production levels. The second is that the North Sea Basin is already 90 percent extracted and new licenses would not change that reality.

Trade minister Chris Bryant said issuing new licenses would not affect energy prices amid the situation in the Middle East. Recent months have seen government ministers repeat similar points. Only a rapid shift to renewables will free energy bills from global hydrocarbon price swings, the article states.

Fourteen years of maximizing drilling licenses under the previous policy produced discoveries that would supply just 36 additional days of gas per year. Opponents have countered that even a small gain in extraction would still be worthwhile.

The International Energy Agency reported in 2021 that no new drilling licenses are needed for the world to meet its net-zero emissions target by 2050. The UK has a legally binding climate target aligned with that timeline. Countries continuing to expand fossil fuel production have been warned that this path risks 4-5C of warming and civilizational collapse.

Ed Matthew, director of the UK programme at think tank E3G, said adopting a policy of extracting every last drop would send a signal to other nations. He added that a world of uncontrolled climate change would create a cost-of-living crisis far worse than current conditions.

One study projects a $38 trillion annual hit to the global economy by 2050 without action.

Sea fields already approved for extraction remain blocked by a Scottish court ruling that required fuller climate impact assessments. Jackdaw is a gas field 150 miles east of Aberdeen owned by Shell. Rosebank is an oil and gas field northwest of Shetland jointly owned by Shell and Equinor.