Ahead of UK government’s decision about Rosebank and Jackdaw, views on revenue generation and climate impact clash.
The North Sea has been particularly tumultuous this past month, but not in the ways you might think.
British energy company BP announced at the end of July that it was moving to sell its North Sea business and assets, ending 60 years of history in the basin and lurching 1100 jobs in the Aberdeen-based business into uncertainty. This decision – made to “focus our portfolio and capital to our highest-value opportunities” in the words of CEO Meg O’Neill – has been in the making for the past 25 years, and marks the exit of the last of the global energy giants, including Chevron, Shell and ExxonMobil, from the North Sea.
Many in the energy industry believe that significant investors walking away from the North Sea could be attributed to the brutal 78% headline tax rate. Scottish First Minister John Swinney highlighted the need for windfall tax reform following the BP exit, stating the need to “end the unfair EPL and put in place a sensible tax regime to protect the workers of Scotland and the north-east.” The Energy Profits Levy was a temporary levy introduced to adjust for the rise in oil and gas prices in 2022 following the Russian invasion of Ukraine, and is currently applied at 38%.
Despite BP’s own exit from the basin, O’Neill urged Prime Minister Andy Burnham to remain “pragmatic” and “use domestic resources first instead of buying those resources from a third party” in an interview with CNBC News, shedding the spotlight once more on the controversial Jackdaw and Rosebank fields. First approved in 2022 and 2023 respectively, the Jackdaw gas field (150 miles east of Aberdeen) and Rosebank oil field (80 miles north-west of Shetland) were subject to uncertainty until January 2025, when the Court of Session in Edinburgh ruled the approvals unlawful due to failure to take into account their climate impact, and that more detailed climate assessments and renewed consent were required for the projects to proceed. Adura, owner of Rosebank and Jackdaw, published these new reports in July 2026. Consultations on the projects drew to a close mid-August, and the UK now awaits what could either be a landmark victory for the fossil fuel energy industry, or for climate activists and environmentalists.
The BP exit acts as the fulcrum of a seesaw balancing between industry and environment. Russell Borthwick, chief executive of the Aberdeen and Grampian Chamber of Commerce (AGCC), stated that it was a reminder that “prolonged policy uncertainty” causes loss of confidence in the UK’s industrial capability. On the other hand, Tessa Khan, executive director of Uplift, a UK-based campaigning and research organisation, said that with “93% of the ageing North Sea’s recoverable reserves already extracted”, BP sensibly moved business elsewhere, and politicians should recognise this and shift focus to “genuine reindustrialisation”.
A rational assessment of the situation probably leads you to one conclusion: there are, as is the way of things, pros and cons. Re-approval of the fields would generate massive revenue, create jobs, and feed back into the domestic energy industry. However, is it worth the cost of carbon emissions, oil spills and ecosystem disruption? Let’s crunch the numbers.
Together, as projected by Offshore Energies UK (OEUK) Rosebank and Jackdaw to support £28.7bn in Gross Value Added, more than 3,500 jobs at peak construction including 880 high-quality jobs sustained throughout production and at least 125 apprenticeships, over their respective 25 and 11-year lifespans. Locally, Rosebank is anticipated to provide work for engineering firms, manufacturers, and specialist energy businesses, amongst others. Almost 200 contracts have been received by energy supply chain companies across north-east Scotland, Fife, the Highlands and north-east England. Increased domestic sourcing is also predicted to increase the UK’s energy security.
AGCC chief executive Borthwick claimed that Jackdaw and Rosebank could provide around 10% of the UK’s future gas supply, and that every million barrels produced domestically “supports 90 times more jobs, generate 150 times more employment taxes and more than 400 times more industry taxes than importing the same amount.” While approval would be a step in the opposite direction to the Labour Party’s 2050 net zero greenhouse gas emission goal, UK Energy Minister Michael Shanks said that gas would be essential for the foreseeable future, and the North Sea oil fields could very well be harnessed to meet those needs.
It is famously recognised that there is no smoke without fire; conversely, it would follow that there is no fire without smoke. A recent environmental impact assessment estimated that Rosebank would generate about 250 million tonnes of greenhouse gases over its lifespan. Oxfam estimated that combined emissions from Rosebank and Jackdaw could be linked to 65,495 excess heat deaths globally by 2100. Research by campaign groups Uplift and Oceana suggested that a major oil spill from Rosebank could damage at least 16 marine protected areas. This year’s devastating heatwaves, estimated to have caused 2,877 deaths, have been analysed to have caused £4.4bn in economic loss to the UK. Extrapolation of the data suggests that the sizable economic damage from heat deaths alone far outweighs any profits, even discounting the human factor. One analysis using research published in the journal Nature projected future damages of up to £170bn to £483bn over the lifetimes of the oil fields. These numbers may appear inflated, and definitely involve exploratory work that might be received with scepticism by some, but they represent a vital truth. As said by Dr Rick Lupton, at the University of Bath, “The general point is sound: climate damage will certainly increase from exploiting these fields, and this may well be comparable or much larger than the economic benefits from the development, especially considering the mismatch between who benefits and who suffers the impacts.”
While rosy promises have been made about domestic energy benefits and prices, the reality falls short. UK consumers do not stand to gain directly from domestic production as the prices they pay for oil and gas depend on international markets. While stranded tanks in the Gulf due to war may seem to support the notion of domestic production, resultant oil and gas would only arrive years after the need had passed. One primary comparison has propped up the argument of those backing the approvals, the carbon-intensity of UK gas is much lower than imported liquefied natural gas (LNG). However, carbon emissions from UK oil and gas production are almost three times as large per unit extracted as Norway, the primary exporter of UK gas. This is because just a production-to-import comparison does not consider the emissions released upon consumption of domestically produced oil and gas.
While public consultations about the matter have drawn to a close, the UK government hasn’t yet released a decisive statement about the matter. The crux of the issue is this: regardless of the relative benefits or negative impacts, any revenue generated by Jackdaw and Rosebank would come invariably at the cost of the general public. It seems rather ironic that the same country that was the site of the Glasgow Climate Pact, which 197 nations adopted to dedicate the 2020s to climate action and support, may now be the base of operations for drilling oil fields that stand to cause climate devastation. For now, climate activists, environmentalists and the general public may only hope that Andy Burnham’s “pragmatism” may sway in favour of clean energy and the transition to a net-zero future.
