Green groups’ fury at loophole in new North Sea oil test

Prospective oil projects in the North Sea with the capacity to produce more than a billion barrels will avoid a new test designed to assess their impact on the climate crisis, the Observer has learned.

In a development that has angered environmental campaigners, it has emerged that proposed new developments representing some 1.7bn barrels of oil will not have to undergo the forthcoming “climate compatibility checkpoint”, designed to determine whether they are consistent with the government’s climate commitments.

The test will be applied before projects are given an initial licence. But the government has confirmed that previously licensed projects will not have to meet it. Campaigners described this as a major loophole that risks undermining the UK’s position before crucial Cop26 climate talks in Glasgow this year.

It comes as ministers face mounting pressure over the Cambo heavy crude field off the coast of the Shetland, which could be given approval before Cop26 begins. The oilfield is expected to operate until 2050. Campaigners say the project contradicts recommendations made by the International Energy Agency, which has called for “no investment in new fossil fuel supply projects”.

The Cambo project is among those that will not have to pass through the government’s proposed climate checkpoint. Data held by the Oil and Gas Authority confirms there are many other schemes in the same position.

The OGA said that licensees would still need to secure other approvals and environmental assessments to commence drilling. The Department for Business, Energy and Industrial Strategy confirmed that undeveloped projects that had a licence would not have to satisfy the new test, but said oil and gas would still be needed for some time to come.

“As part of the UK’s shift towards green energy, through our landmark North Sea transition deal, we are backing the decarbonisation of the oil and gas sector to support high-value jobs and safeguard the skills necessary to develop new, low-carbon industries across the country,” said a spokesperson.

“We are working hard to drive down demand for fossil fuels, investing hundreds of millions of pounds into clean energy. We have also ended support for fossil fuels overseas. As recognised by the independent Climate Change Committee, there will continue to be ongoing demand for oil and gas over the coming years as we transition to green energy.”

But green groups called for the loophole to be tackled. “Before we even got a chance to find out whether the government’s climate compatibility checks are any good, it turns out a slew of oil and gas projects are going to slip through the net anyway thanks to a major loophole,” said Sam Chetan-Welsh of Greenpeace UK. “If Boris Johnson turns up in Glasgow with a pipeline of climate-wrecking projects ready to be approved, the stench of hypocrisy will be smelled worldwide.”

Tessa Khan, founder of Uplift, which campaigns for a fossil fuel-free UK, said: “There’s no such thing as a ‘climate-compatible’ oil and gas licence in 2021 or beyond. The world’s leading energy agency has made it clear that we can’t have any new investments in oil and gas if we’re going to meet our climate goals. If Boris Johnson is serious about being a climate leader, the government will stop issuing oil and gas licences and close the loopholes that will allow climate disasters like Cambo field to be approved for years to come.”

Ministers had already frustrated green groups by stating that oil drillers could continue to explore the North Sea for new reserves, should they pass the new test. Campaigners had hoped that the UK would follow the lead of Denmark and France by agreeing to ban new oil exploration licences.

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