Two legal challenges loom over UK’s giant undeveloped oil field

Following the green light for the development of an Equinor-operated field, legal trouble brews on the horizon for the UK government and one of the largest undeveloped oil fields in Britain over climate concerns. Environmental groups are taking the government to court over the approval for the Rosebank project, with two separate judicial review challenges already filed against the UK’s decision – one by Uplift and the other by Greenpeace UK. Both are expected to be heard in the Court of Session in Edinburgh.

Located West of Shetland, the controversial Rosebank project, which was previously delayed, caught a break in September 2023, when it received a stamp of approval from the North Sea Transition Authority (NSTA). Without wasting any more time, Equinor and its partner, Ithaca Energy, took a final investment decision to progress Phase 1 of the development, investing $3.8 billion in the project and targeting an estimated 245 million barrels of oil.

While climate campaigners argue that Rosebank is not compatible with a safe climate or liveable future, the partners in this development highlight that the project has been optimized to reduce carbon emissions, in line with the North Sea Transition Deal, as the FPSO is designed to be electrification-ready. Furthermore, Ithaca Energy and Equinor continue to collaborate with government and industry stakeholders to pursue a regional solution for power from shore to Rosebank and nearby fields to minimize carbon emissions from production.

“We believe that this decision is not just morally and economically wrong, but unlawful. The government’s claim that drilling Rosebank is compatible with the UK’s obligations and a safe climate isn’t adding up – and we will prove it in court. We’re filing not just one, but two cases against the government so we can #StopRosebank,” stated environmentalists under the campaign slogan #StopRosebank.

These legal challenges will argue that the government has failed to assess the emissions generated from burning Rosebank’s oil and is downplaying the marine impacts of the project, as environmental activists are convinced that Rosebank is not compatible with the UK’s commitment to a safe climate. These cases intend to claim that government agencies should not be allowed to approve oil fields that would breach climate targets, as the NSTA recently disclosed that the industry is already off track to meet the net zero target.

The cases are being supported by: 350.org, BankTrack, Culture Unstained, Environmental Justice Foundation, Extinction Rebellion, Friday for Future Scotland, Friends of the Earth Scotland, Fossil Free London, Fossil Free Parliament, Fuel Poverty Action, Global Witness, Green New Deal Rising, Greenpeace Norway, Grandparents Climate Campaign Norway, Laudato Si Movement, Lawyers are Responsible, MedAct, Mothers Rise Up, Oceana, Oil Change International, Parents for Future UK, Platform, Sierra Club Canada, Tipping Point, War on Want, Whale and Dolphin Conservation, World Cetacean Alliance.

Moreover, Uplift and Greenpeace in their separate judicial review challenges of the government’s decision to approve Rosebank argue that the decisions of the Secretary of State for Energy Security and Net Zero and the NSTA are “unlawful” because the approval of the field is incompatible with the government’s climate commitments. They argue that the approval of Rosebank makes it effectively impossible to achieve the emissions reduction targets in the North Sea Transition Deal (NSTD).

According to Uplift and Greenpeace, the NSTA has failed to give reasons at all for its decision to grant consent for the development. The cases challenge the alleged lack of transparency from the UK regulator, particularly around what is involved in its net zero tests and how it could have concluded that Rosebank passed the test.

Despite Rosebank containing multi-million barrels of oil and gas, the burning of which will produce “more CO2 than the annual emissions of the world’s 28 lowest-income countries combined,” the government has ignored the emissions that come from burning the fossil fuels that Rosebank will produce, based on these two legal challenges.

Even though Equinor is saying the field may be powered by renewable energy, climate activities see this as a greenwashing attempt to lower the carbon footprint of the oil field. Located about 130 kilometers off the coast of the Shetland Islands in the UK, the Rosebank oil and gas field is estimated to contain 300 million bbl of potentially recoverable reserves.

While claiming that the government has failed to adequately assess the marine impacts of Rosebank, including minimizing the impacts on a marine protected area (MPA), Uplift and Greenpeace UK argue that the project will significantly hinder the conservation objectives of the Faroe-Shetland Sponge Belt, which is a Nature Conservation MPA.

The field will be developed with subsea wells tied back to a redeployed floating production storage and offloading (FPSO) vessel, with the first production expected in 2026-2027. The Rosebank project will produce over 21 mmscf of natural gas every day, the equivalent of the daily use of Aberdeen City. At its peak, the field could produce 69,000 barrels of oil or 9,000 tons per day, which is equivalent to 8% of the UK’s entire output between 2026 and 2030.

This development is expected to lead to £8.1 billion (over $9.8 billion) of total direct investment, of which 78% is likely to be invested in UK-based businesses. The project is expected to support around 1,600 jobs during the height of the construction phase. It will also continue to support approximately 450 UK-based jobs during the lifetime of the field.

Altera has been awarded a bareboat charter and an operations and maintenance contract related to the FPSO Petrojarl Knarr, which is set to be deployed on Rosebank for nine years, with options for up to a total of 25 years. With electrification, it is estimated that the Rosebank lifetime upstream CO₂ intensity would decrease from 12 kg to about 3 kg CO₂/boe.

These legal challenges are being mounted on climate grounds only days after COP28 gave birth to a deal to transition away from all fossil fuels. Aside from tripling renewable energy capacity and doubling the rate of energy efficiency improvements by 2030, the final text brings into play the importance of tackling methane emissions and other non-CO2 emissions in this decade along with the need to do much more to meet the goals of the Paris Agreement.

Bearing in mind all the positive signals, options, and actions COP28 has put on the table, this is seen as one of the most significant UN climate talks since 2015, when the Paris Agreement was agreed.