The UK government on Wednesday approved the long-delayed Jackdaw gas field in the first approval of a new North Sea project since the Iran war hiked energy prices.
Jackdaw will start to supply gas to British homes and businesses from the end of this month, after the UK Energy Secretary agreed that the regulator can grant consent for gas to be produced at the field, Andy Burnham’s Labour government said in a statement.
The Jackdaw project, led by Adura, the new company Shell and Equinor have created by merging their oil and gas assets in the UK North Sea, was initially approved for development several years ago. But environmentalists sued and overturned the consent on the grounds that the effects of the development on the climate were not considered. The project had to undergo environmental and regulatory reviews again.
This year’s energy crisis, triggered by the Iran war and the closure of the Strait of Hormuz, has intensified pressure on the UK government to approve the development of Jackdaw to boost energy security.
“Recent events in the Middle East have triggered global energy shocks and pushed up bills for families across the country. At a time of global instability, homegrown energy can be a source of national strength,” the UK government said today.
PM Burnham said that his government is “taking a pragmatic approach to the North Sea” to boost homegrown energy as Britain would need oil and gas for decades even if it continues to pursue net zero by 2050.
Jackdaw’s operator, Adura, welcomed the government’s consent and said that Jackdaw could produce enough gas to heat the equivalent of around 1.4 million UK homes at peak production.
“Today’s approval clears the way to allow Jackdaw to start supplying gas to British homes, power stations and businesses within weeks,” the company said, noting it hopes the other long-stalled project, Rosebank, to also receive consent soon.
At peak production, Jackdaw and Rosebank could provide around 10% of the UK’s domestic gas production and 10% of oil output from the North Sea, Adura says.
“Our attention now turns to Rosebank. It follows Jackdaw in the regulatory process, but the case for approval is equally strong,” Adura’s CEO Neil McCulloch said.
“We believe that applying the same rigorous, evidence-based approach can lead to a similarly positive decision.”
By Tsvetana Paraskova for Oilprice.com
