North Sea faces exodus if Rosebank and Jackdaw aren't approved quickly, says developer
Equinor vice president Holly Pattenden said “the clock is ticking” for retaining the skilled workforce in Aberdeen.
There will be an exodus of North Sea supply chain companies if Rosebank and Jackdaw are not approved quickly, the developer of the two projects has warned.
Holly Pattenden, vice president of Norwegian energy giant Equinor, said “the clock is ticking” for retaining the skilled workforce.
She also welcomed the removal of Ed Miliband - viewed to be blocking the proposed oil and gas fields - as Energy Secretary.
Ms Pattenden was speaking at a fringe event at the Reform UK conference in Birmingham.
She said: “If the current restrictions stay in place and Rosebank and Jackdaw are not approved, we are going to see really serious problems with the exiting of some of these fantastic supply chain companies.
“I think that the clock is ticking for making sure that we can retain the brilliant skills and technical expertise that resides within those companies.
“Because otherwise they are going to leave and they're going to go to places which have much more attractive investment regimes elsewhere in the world.”
Rosebank and Jackdaw are operated by Adura, which is a joint venture between Norwegian company Equinor and Shell. Aberdeen-based firm Ithaca also owns 20 per cent of Rosebank.
Ms Pattenden said Equinor, which is majority owned by the Norwegian government, was optimistic about a change in direction under the new Prime Minister.
She said: “We were quite encouraged with the arrival of Andy Burnham, in that he promised to take a more pragmatic and open-minded approach to the North Sea.
“In addition, we have seen Ed Miliband move from the Energy Ministry into being Foreign Secretary, and and Miatta Fahnbulleh, who has succeeded him, has also said she's going to take a pragmatic approach.
“We have yet to see what pragmatic means, but we like to think that it will include both approving Rosebank and Jackdaw and potentially looking at lifting some of the other restrictions that are currently constraining investment in the North Sea.”
Ms Pattenden was speaking just hours after reports emerged on Monday that Jackdaw, 150 miles west of Aberdeen, would be approved. But it has been suggested that Rosebank, west of Shetland, could be rejected.
Ms Pattenden said: “While we hear positive news about Jackdaw being approved soon, we're not hearing such positive news yet on Rosebank.
“We are very keen to see the government making the right decision there to accept the investment that we've put in and to make sure that the country can feel the benefit of the oil and gas resources in the UK through tax receipts, through jobs, and through other economic value.”
David Whitehouse, chief executive of trade body Offshore Energies UK, said on the same panel: “I think some of the language is helpful that we're hearing, and now we need to see if that turned into action and reality.”
He added: “If approved Jackdaw is ready to produce the gas needed in the UK this winter and the planned Rosebank energy project is similarly essential.”
Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce, said approving Jackdaw would be a “hugely important vote of confidence” in the North Sea which would protect jobs, strengthen energy security and ensure more domestic oil and gas is used.
He said: “But Jackdaw cannot be the end of the story - the same urgency must now be applied to Rosebank, another major project capable of supporting thousands of jobs, billions of pounds of economic activity and significant tax revenues for the Treasury.
“Together these projects represent 10 per cent of our future gas supply at a point where we face a critical gas shortage.
“The Prime Minister has rightly called for a pragmatic approach to domestic oil and gas. Swift approval of both Jackdaw and Rosebank would put those words into action, but we also need the Government to address the punitive tax regime which is driving investment and jobs out of the North Sea.
“That means ending the energy profits levy at the start of the new tax year and moving to the permanent, price-based oil and gas revenue levy. Taken together, those decisions would send a powerful signal that Britain is serious about backing its energy workers, its industrial base and its own energy security.”
Shadow Energy Secretary Andrew Bowie said: “Approving Jackdaw gasfield is just common sense and should have been given the green light years ago.
“Labour’s ban on new oil and gas licences has been disastrous for the north-east and cost thousands of workers their jobs as they continue to dither over a decision.
“That has been compounded by the SNP’s hostility towards the sector and John Swinney’s continued presumption against any new oil and gas projects.
“Andy Burnham must finally give this project approval and do the same with the Rosebank oilfield.”
However climate campaigners say the UK Government must not “cave in to fossil fuel company pressure”, as burning fossil fuels from Jackdaw will worsen the climate emergency.
Caroline Rance, head of campaigns at Friends of the Earth Scotland, said: “New fossil fuels means deadly new climate disasters like the devastating floods in Nepal or the extreme heatwaves that have killed nearly 3,000 people in the UK this summer.”
Both Jackdaw and Rosebank had previously been approved by the former Conservative government, but this was delayed after a legal challenge by environmental campaigners in the Court of Session.
Last year the Court of Session ruled that both oilfields have been unlawfully approved because the government had failed to take into account the climate impact of extracting oil and gas from these fields. The judge said more detailed climate assessments needed to be published.
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