ENVIRONMENTALISTS are launching a legal bid to force the UK Government to end support for the North Sea oil and gas industry.
The campaigners have taken steps to initiate a High Court action on the grounds that the official drive to maximise North Sea production is both unlawful and irrational.
They claim the policy of maximising economic recovery of the North Sea’s reserves promoted by the Oil and Gas Authority is unlawful because it fails to take account of the billions of pounds of public money used to support the industry. This means the resulting production is not economic for the UK.
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The policy is irrational because it will result in increased oil and gas production, in conflict with the UK’s legal duty to achieve net zero emissions by 2050.
The legal claim names the OGA as a defendant along with business secretary Kwasi Kwarteng, who is responsible to Parliament for the OGA and sets its policy.
The claim is being made through an application for a judicial review of the OGA’s policy. This has been made by law firm Leigh Day on behalf of three campaigners.
The claimants include Kairin van Sweeden, who is on the Scottish National Party policy development committee and heads the Modern Money Scotland think tank. The others are Mikaela Loach, a climate activist and medical student at the University of Edinburgh, and former refinery worker Jeremy Cox.
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“Our clients’ case is that the OGA’s new strategy encourages companies to produce oil and gas without considering the economic repercussions of that on the public purse and the UK as a whole,” said Leigh Day’s Rowan Smith.
“This means that, in some circumstances, such production is not ‘economic’ for the UK as a whole, but the OGA is still seeking to maximise it.”
He added: “The case argues that is unlawful, having regard to the terms of the OGA’s legal duty, and also irrational, because it will result in increased levels of oil and gas production, in conflict with the UK’s legal duty to achieve net zero emissions by 2050.”
The claim highlights the value of the tax reliefs provided in respect of spending in areas such as decommissioning. The OGA has said the bills for decommissioning the thousands of platforms, wells and related pipelines in the North Sea could reach more than £50bn. The costs will be tax deductible.
The action has been launched at a time when the outlook for the North Sea oil and gas industry is very uncertain.
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Oil and gas firms have come under sustained criticism amid claims their activities are helping fuel climate change. They have faced huge trading challenges as a result of the fallout from the coronavirus crisis, which has triggered hefty job losses in the North Sea.
Industry leaders maintain oil and gas firms have a vital role to play in meeting demand for energy while supporting thousands of jobs. They insist the skills and capabilities offered by North Sea firms can be used to speed the development of renewable energy generating capacity on the required scale.
Campaigners were angered when the Government recently made clear it felt the North Sea oil and gas industry and the reserves in the area were important national assets.
In March the Government combined the announcement of a £16 billion North Sea Transition Deal with confirmation that new oil and gas licences could be awarded in future, if they were deemed to be compatible with the UK’s climate change objectives.
In February the OGA adopted a new strategy, under which firms are required to take appropriate steps to help the Government to meet its net zero target while maximising the expected net value of economically recoverable petroleum from relevant UK waters.
The claimants in the action against the OGA are being supported by Uplift, which says its aims to energise the movement for a just and fossil fuel-free UK. Uplift is co-ordinating the Paid to Pollute campaign launched recently by environmental groups such as Greenpeace UK and Friends of the Earth Scotland.
The claimants have applied to the High Court for a judicial review , which they hope will conclude the OGA’s strategy is unlawful. If the application is granted it is expected there would be a hearing later this year, with a decision to follow in 2022.
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