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 Court rules oil and gas field approvals were unlawful
Commercial dispute resolution

Court rules oil and gas field approvals were unlawful

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In a significant ruling, the Court of Session in Edinburgh has declared that the consent granted for the Rosebank and Jackdaw oil and gas fields was unlawful, marking a pivotal moment in the debate surrounding the UK’s energy policy and environmental responsibility. The judgment, handed down by Lord Ericht, came as the result of a legal challenge brought by environmental campaigners Greenpeace and Uplift, who argued that the projects had not undergone sufficient environmental assessments, particularly regarding their climate impact.

The ruling mandates that the developers of the two fields must seek fresh approval from the UK Government before proceeding with production. The judge emphasised that a more detailed assessment of the environmental impact of both projects was needed, especially considering the downstream emissions associated with burning the extracted fossil fuels. While work on both fields can continue, no oil or gas may be extracted until new approval is granted.

Shell’s Jackdaw gas field, approved in 2022, and the Rosebank oil development, approved in 2023, are both seen as crucial for the UK’s energy security, but their environmental impact has raised concerns. Rosebank, in particular, is a major find, with estimates suggesting it contains between 300 million and 500 million barrels of oil, making it the largest untapped field in UK waters. Despite these potential benefits, the environmental risks, particularly in terms of climate change, cannot be overlooked.

The court ruling follows a landmark decision in June 2024 by the UK Supreme Court in the case of Finch v. Surrey County Council, which required that environmental impact assessments (EIAs) for such projects must consider not only the direct emissions from extraction but also the downstream emissions from the burning of the fossil fuels. This judgment now applies to the Rosebank and Jackdaw fields, forcing the government and regulators to reconsider the consent process, taking these emissions into account.

Lord Ericht’s ruling also highlighted the public interest in ensuring decisions are made by public bodies on a lawful basis, particularly when it comes to projects that could contribute significantly to climate change. He rejected arguments from the developers, including Shell and Equinor, that they had acted in good faith, noting that they should have been aware that the legal landscape surrounding such projects was uncertain. Despite Shell’s claims that the Jackdaw field is vital for domestic energy security and economic growth, the judge made it clear that the legality of the approval was his primary concern.

For the companies involved, the decision represents a setback, but not a final blow. Shell and Equinor have both expressed their intention to continue working with the government to secure the necessary approvals, with Shell indicating that the Jackdaw project will proceed if fresh consent is granted. They argue that the fields are essential for meeting domestic energy demand, with Shell claiming that Jackdaw alone would provide enough gas to heat 1.4 million homes. However, environmental campaigners remain steadfast, arguing that the UK must take stronger action to transition to renewable energy sources rather than further invest in fossil fuel extraction.

The court’s decision has also triggered a political response, with UK Government officials acknowledging the need for clarity on the issue of downstream emissions. As the country faces an increasingly urgent climate crisis, the balance between energy security and environmental protection continues to be a contentious issue. With the ruling now in place, the government must reassess its stance on new oil and gas fields, ensuring that all future projects are evaluated comprehensively, with full consideration of their long-term environmental impact.

The ruling has been hailed as a victory by environmental groups, with Greenpeace’s Charlie Kronick noting that granting approval for the projects would be inconsistent with the UK’s climate targets. The organisation, alongside Uplift, has long argued that new oil and gas fields should not be developed if the UK is to meet its commitments to reduce carbon emissions and prevent catastrophic climate change. Campaigners are united in urging the government to reject future renewed applications for the projects.

Law firm Harper Macleod acted for Greenpeace, playing a key role in the legal challenge, providing expert counsel and support in this case. The firm’s involvement highlights its commitment to environmental advocacy and ensuring that the legal framework surrounding energy projects aligns with the UK’s legal (including climate-related) obligations. This case marks another significant moment for Greenpeace, which has been at the forefront of legal efforts to hold the government and corporations accountable for their role in climate change.

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