Europe: Big Oil wants to keep drilling in the North Sea. The backlash is growing

“We will know if politicians are listening if the UK government, as hosts of COP who aspire to lead on climate, call time and put a stop to Cambo,” said Tessa Khan, a climate lawyer who leads the advocacy group Uplift.On Monday, the United Nations’ Intergovernmental Panel on Climate Change warned the world has rapidly warmed 1.1 degrees Celsius higher than pre-industrial era levels, and is now careening toward 1.5 degrees.Yet the world remains reliant on oil and gas, and companies like Shell are working to provide it. To reach net-zero emissions by 2050, however, no new oil or gas fields can be approved for development, the International Energy Agency warned earlier this year.“If we reduce the consumption of oil in line with what is needed to reach [the 2050] targets, we will not need to invest in new oil or gas exploration or new coal mining. Very clear,” Fatih Birol, the IEA’s executive director, said in a recent interview on Cambo with the UK’s Channel 4. The UK government, he added, should choose to be an “inspiration for the rest of the world.”

The Cambo oilfield

The Cambo oilfield is a key project for Shell, which holds a 30% stake, and Siccar Point, which controls 70% of the venture.

“It’ll be important for both of them because there are so few developments now [in the North Sea],” said Alexander Kemp, a professor of petroleum economics at the University of Aberdeen.

Discovered in 2002, the field could contain over 800 million barrels of heavy crude. Deepwater drilling is expected to start in 2022, with oil production kicking off in 2025 and running until 2050.

“It’s a significant size field by today’s standards,” said Kemp, noting that a more typical development would yield about 20 million barrels, not 164 million.

But the project has stoked the ire of a coalition of environmental advocates, who are ramping up political pressure by highlighting the optics of approving the development so close to COP26. The oil produced will have the same climate footprint as running about 18 coal-fired power stations for a year, Uplift has calculated.

“The proposed new Cambo oilfield is a clear climate contradiction,” Jamie Livingstone, head of Oxfam Scotland, said in a statement this month. “If the UK government is to be a credible broker for a deal that can stop the planet overheating when it hosts the COP26 climate talks in November it must intervene in the Cambo case.”

The IEA’s net-zero roadmap published in May is another flash point. The report plainly states that as of 2021, no new oil and gas fields can be developed in order to reach climate targets. Uplift’s Khan said this is “the first major test” since the warning was issued.

A looming decision

The UK Oil and Gas Authority (OGA) is expected to imminently decide whether to allow the development to proceed.

Prime Minister Boris Johnson told local media late last week that the choice is up to the regulator and “no contracts should be ripped up.” Greenpeace has said if the OGA moves ahead, it could sue.

The activist group takes particular issue with the government’s announcement that it will require new “climate compatibility checkpoints” on future oil and gas licensing rounds to make sure they’re in line with the United Kingdom’s pledge to reach net zero emissions by 2050. That doesn’t apply to Cambo, since a license was already issued in 2001 when exploration of the area began. Greenpeace has called this a deliberate “loophole.”

Alok Sharma, the lawmaker appointed by the UK government to lead COP26, did not directly address whether North Sea oil production contradicts UK climate goals when asked by reporters Monday, saying that the government was “going to be very rigorously applying a climate compatibility check” for “future” oil and gas licenses.