Rachel Reeves has revealed that Jackdaw and Rosebank will get the go ahead and stressed the importance of North Sea oil and gas to the British economy "for decades to come".
Speaking ahead of the Spring Statement on Wednesday, the Chancellor said the two fields - which have been held up by a legal challenge - would get the consents they need to progress.
The news is a significant intervention by the Treasury that will unlock billions of pounds of investment in the energy sector supply chain, which is largely based in the North-east of Scotland.
Court battle
Earlier this year, the Court of Session determined that the approvals granted for Jackdaw and Rosebank were unlawful because they did not account for the greenhouse gas emissions resulting from the eventual combustion of the extracted oil and gas, known as 'scope 3' emissions.
This decision aligns with a prior UK Supreme Court judgment mandating that such downstream emissions be considered in environmental assessments.
The court's ruling means that both Shell's Jackdaw gas field and Equinor's Rosebank oil field must undergo new approval processes that include comprehensive evaluations of their environmental impacts, particularly concerning scope 3 emissions.
Energy Secretary Ed Miliband called Rosebank “climate vandalism” when in opposition - but it appears that that Treasury has pulled rank on the fields, which will generate billions of pounds for the UK economy.
'And go ahead they will...'
Speaking to the Sun on Sunday, Ms Reeves was unequivocal about the projects being consented.
She said: “We said in our manifesto that they would go ahead, that we would honour existing licenses, and we're committed to doing that, and go ahead they will.
“North Sea oil and gas is going to be really important to the UK economy for many, many decades to come. And we want to make sure that fields that have already got licenses can continue to exploit those reserves and bring them to market."
In response to the Court of Session ruling, the UK Government has initiated a consultation to revise environmental guidance, aiming to incorporate considerations of emissions from burning extracted oil and gas.
This consultation concluded in early January 2025, and the government plans to publish the updated guidance in the spring. Once finalised, developers will be able to reapply for consents under this new framework, which is intended to provide stability for the industry while aligning with the UK's climate obligations.
Boost for economy
The Rosebank oil and gas field is projected to deliver substantial economic benefits to the UK.
According to Equinor, the total field investment is estimated at £8.5billion, with approximately 77% (£6.6billion) expected to be directed towards UK-based businesses.
Over its operational lifetime, Rosebank is anticipated to generate a gross value add (GVA) of £25billion, encompassing direct, indirect, and induced economic impacts.
Shell meanwhile has said the Jackdaw field, at its peak, would produce enough gas to heat more than 1.4 million UK homes.