The government has announced it will introduce a new oil and gas licensing scheme in a move that has angered climate campaigners.
Until this week, the UK had no fixed period between the awarding of oil and gas licensing rounds. But Prime Minister Rishi Sunak has introduced a scheme that would require the North Sea Transition Authority to invite applications for new production licences annually.
The announcement was made in the King’s Speech that marked the opening of Parliament. The new bill was described as helping the country transition to net zero in a “pragmatic, proportionate and realistic way”.
“This bill will support the future licensing of new oil and gas fields, helping the country to transition to net zero by 2050 without adding undue burdens on households,” the King said, adding it would help “reduce reliance on volatile international energy markets and hostile foreign regimes”.
The government has also said the move will provide job security for 200,000 workers.
The plans draw a dividing line between the Conservative government and Labour, which has campaigned for a divestment from fossil fuels and opposed the granting of new oil and gas drilling licences in the North Sea.
“Domestic energy will play a crucial role in the transition to net zero,” Sunak said, stressing that the requirement for annual rounds each year will be conditional on domestic production being greener than imported alternatives.
Labour’s shadow energy security secretary, Ed Miliband, described the plans as a “desperate political strategy”, adding that “it is precisely our dependence on fossil fuels that has led to the worst cost-of-living crisis in a generation”.
Environmentalists have also criticised the decision: Greenpeace said that encouraging oil and gas production was “backward-facing” and vowed to fight new licences in court.
“If there was a prize for political posturing, Rishi Sunak would win best in show,” said Jamie Peters, climate coordinator at Friends of the Earth. “The fact remains that more North Sea oil and gas will do nothing to reduce bills or improve energy security.”
Claire Coutinho, the energy secretary, told the BBC that the new licences “wouldn’t necessarily bring energy bills down”, but stressed the money obtained from them could be reinvested in powering the UK’s green transition.
The announcement marks another step in Sunak’s strategy to push back on green policies. He was criticised by industry bodies earlier this year when he decided to delay the ban on petrol cars and the deadline for the replacement of gas boilers, despite maintaining the UK’s commitment to reach net zero by 2050.
Oil and gas remain the largest source of energy for the UK, the majority of which comes from drilling sites in the North Sea. There are just under 300 active oil and gas fields in the region, but half are expected to have ceased production by 2030, according to Offshore Energies UK.
Last week, 27 licences were approved for projects in central and northern areas of the North Sea and west of Shetland, as part of the UK’s latest licensing round.
