Fortune is favouring the continuing extraction of fossil fuels from the North Sea following today's announcement that drilling will go ahead at the controversial Rosebank oil field located 80 miles off the cost of Shetland.

It is the largest untapped repository oil and gas in UK waters and as such a major battlefield for climate protestors who have slammed the granting of development and production consent by the North Sea Transition Authority (NSTA). Owners Equinor and Ithaca Energy are targeting 300 million barrels of oil over two phases of development, plus more than 21 million cubic feet of gas per day.

As majority owner with an 80% stake it was down to Norway's Equinor to give the go-ahead on the "final investment decision" at Rosebank, which it did in rapid order following the announcement from the NSTA.

London-listed Ithaca owns the remaining 20% of the venture but today's decision has wider implications as the company will soon own 100% of the Cambo oil field located less than 20 miles south-west of Rosebank. As the second-largest untapped field in UK waters, it too is a focal point for environmental campaigners.

Ithaca bought an initial 70% stake in Cambo with its $1.5 billion acquisition of Siccar Point Energy in July of last year. It announced earlier this month that, subject to regulatory approval, it is set to take full ownership after Shell failed to find a third-party buyer for its 30% stake in the project. 

Cambo is expected to deliver up to 170 million barrels of oil equivalent during its 25-year operational life. 

Today's decision on Rosebank is seen as a positive for the whole of the UK North Sea offshore sector, which has warned repeatedly that investment will be hampered by the introduction in May 2022 of a windfall tax on the excessive profits of oil and gas companies. Shares in Ithaca, which continues to "evaluate" the future of Cambo, were trading more than 8% higher this afternoon in response to the announcement on Rosebank.

Cambo faces additional hurdles as Ithaca will have to fund the project on its own. Lending to the industry has slowed significantly as banks cut their exposure to fossil fuels, while the energy profits levy and higher interest rates have also had an impact.

Ithaca acquired the remaining 30% of Cambo at a price of £1.20 per barrel of oil equivalent, or just a little over £64 million. However, this won't be payable until the field produces first oil, meaning there is little upfront impact beyond increasing Ithaca's share of the build costs.

Analysts are anticipating a decision on Cambo by the middle of next year. Meanwhile, the NSTA decision on Rosebank could join others in being legally challenged by environmental activists.

Rosebank isn't a straightforward portent of things to come, but having granted approval for the larger development there seems little justification for authorities to withhold on Cambo.