Energy / Rosebank approval set to be reconsidered after emissions court ruling
THE UK Government will have to reconsider its approval for the Rosebank oil and gas field 80 miles northwest of Shetland to take into account wider emissions following a court ruling.
It follows legal action from Greenpeace and Uplift, who argued that the decision to approve Equinor’s proposed Rosebank development did not take into the account the effect on the climate of burning the oil and gas produced from the field – known as downstream emissions.
The campaign groups also undertook legal action against Shell’s Jackdaw gas development, which is located east of Aberdeen and was expected to go into production in 2026.
In a ruling published on Thursday, Lord Ericht said the decisions to approve the two projects should be quashed (reduced) and made again, but this time taking the effect of downstream emissions into account.
However, the reduction will be suspended until the fresh decision is reached – although no oil or gas can be extracted from the sites during the suspension period.
The suspension has been imposed so that developers can be given options as to how to proceed pending the reconsideration, such as pressing ahead with work, or taking no further action until the UK Government has made its decision.
The Rosebank site is estimated to be the largest undeveloped oil and gas field in the UK continental shelf, with recoverable resources said to include over 300 million barrels of oil equivalent and the site having a production life of around 25 years.
It was given development and production consent from the UK Government in 2023.
Work is already underway on the project and drilling was due to begin in the first or second quarter of this year.
Locally equipment for the Rosebank has already been arriving in Lerwick Harbour by boat, to be shipped onwards to the field.
It would be developed with a Floating Production Storage and Offloading vessel (FPSO) tied to a subsea production system, meaning oil will bypass Shetland.
But gas will go through the sweetening facility at Sullom Voe Terminal before heading into a new crossover pipeline and ultimately ending up at the St Fergus terminal on the Scottish mainland.
Equinor has previously said that Rosebank is a “vital project for the UK and is bringing benefits in terms of investment, job creation and energy security”.
But environmental campaigners say it would be undermining the UK’s own climate targets.
The new Court of Session ruling document published today noted that all parties agreed that the decisions to give consent to Rosebank and Jackdaw were “unlawful” as their environmental impact assessments (EIA) did not take into account the effect on climate of the combustion of the oil and gas to be produced.
It followed a landmark Supreme Court ruling last year involving Surrey County Council which requires decision-makers to consider the impact of burning oil and gas in environmental impact assessment for new projects.
A key question in the Rosebank/Jackdaw case thereafter was whether the decisions should be quashed and made again on a “proper and lawful basis taking into account downstream emissions”, or if the decisions should stand and projects be allowed to proceed.
The oil and gas developers argued that the projects should be allowed to proceed, but the campaigners said the decision to approve the developments should be made again.
For Rosebank, it is estimated that the field would produce seven per cent of the UK’s oil crude output in the period to 2030.
The field would also produce in excess of 21 million standard cubic foot of natural gas per day, equivalent to the daily usage of Aberdeen.
Rosebank is expected to produce around 4.5 per cent of the UK’s gas production for the period 2032-2035.
The court document said that a rough calculation on downstream emissions shows that Rosebank and Jackdaw combined would likely be responsible for 0.00006345 degrees Celsius of global warming.
It was calculated that as a result of the two developments there would be “approximately 32,000 additional heat related deaths until 2100, with that figure being purely from heat-related deaths and not from other climate impacts”.
The document also highlighted the work that has taken already place on preparing Rosebank for drilling.
“By the time the judicial review proceedings were commenced by the petitioners in late 2023, Equinor had placed more than 260 different contracts, committed funding of £1.87 billion and spent £466 million,” it said.
The court was also told that if there was delay allowing reconsideration of Rosebank’s consent, there is a “real risk” that work planned in 2025 could not be rescheduled to 2026.
“This is for various reasons, including the limited availability of specialist vessels which must be contracted and scheduled several years in advance,” the document said.
“A one year delay in relation to the consents would actually delay the project by two years or more. An even longer delay would likely arise if it was necessary to cancel the existing contracts and re-tender, rather than just negotiate extensions to the existing awarded contracts.”
A one-year delay could cost the developer around £400 million, it was claimed.
Lerwick playing its part as installation work gets underway on Rosebank oil development
The document added: “Equinor estimates that a one year delay in the taking of new decisions on the grant of consent would result in at least a two to three year delay in first oil and commencement of production and Equinor may be required to pay compensation under various contracts, or the contracts may be terminated.”
Equinor argued that it would be “inequitable and unjust” to reduce the original consent decisions given the stage the project had reached and the “prejudice to the public interest that would be occasioned”.
“The key questions for the court were whether Equinor should be made to bear the consequences of the failure by the respondents in their understanding of the legal requirements of an EIA and whether the Rosebank project should be placed in limbo for a significant period of time as a result,” the document added.
In the conclusion, it was highlighted that if the decisions have to go back to the government, this time taking into account downstream emissions, then the consents may be granted – or may not.
“That will be a matter for them.”
Lord Ericht ruled that 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”.
“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 of an unlawful decision.
“The decisions will be reduced, and can be taken again, this time taking into account downstream emissions.”
The document also highlights that the government’s decision-making process would include public consultation.
Lord Ericht added that it would be “wrong and disproportionate” for the reduction to take effect immediately, and therefore bring a halt to work on the projects prior to reconsideration.
But he added that at this stage the government is not in a position to specify what further information about downstream emissions the developers should provide. It is thought that the guidance on this could be published by the UK Government this spring.
“It is in the interests of good administration that the government gives proper consideration to what will be required in assessing downstream emissions, and in so doing has the benefit of the results of public consultation,” the ruling added.
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