Miatta Fahnbulleh is leaning towards rejecting the giant Rosebank oilfield, the Guardian understands, in what would be a blow for the North Sea energy industry and a major victory for climate campaigners.
Officials say the energy secretary is minded to refuse approval for the field, which would be one of the biggest in the North Sea. Fahnbulleh approved the smaller Jackdaw gasfield on Wednesday, prompting protests from some in the green movement.
But she told the Guardian that the rationale behind Jackdaw did not apply to Rosebank, saying the UK would rely on gas as it made the transition to net zero and that it would be better to take it from relatively low-carbon sources in the North Sea than importing it.
“One is a gasfield that caters for the domestic market, while the other is an oilfield that is mainly for export,” she said. “It is right that we judge each application in its own right, and it is absolutely critical that the decision is consistent with our climate obligations, our carbon budgets and the end destination we need to get to with the energy transition.”
Officials say Fahnbulleh has not yet taken a final decision on Rosebank, but a ruling is expected later this year. The field would emit about seven times the carbon of Jackdaw and Fahnbulleh is understood to believe that it would do less for UK energy security, given most of the oil would be exported.
On a visit to Aberdeen, Fahnbulleh said she had been satisfied that Jackdaw, which is due to begin producing gas within weeks and will add an estimated 36m tonnes of carbon emissions, would not violate the UK’s climate commitments.
“As we make the transition, we are going to need gas,” she said on a visit to Aberdeen to announce the decision. “At a point when we have got conflict in the Middle East that is triggering an energy crisis, energy security is vital, and homegrown energy is key.”
She admitted, however, it would not help achieve the government’s main energy target of bringing down bills, saying: “This is not about bills.”
The UN Environment Programme has recommended that global carbon emissions be cut by nearly a fifth in the next four years, and by close to half within a decade, to avoid overshooting climate targets by a disastrous margin.
Fahnbulleh has promised that future revenues from the North Sea will be spent on green energy projects through a new energy wealth fund. The fund will be given £2bn in the budget, she said, some of which will be reallocated from other parts of her department’s budget.
“When we have tax revenues that are coming from the oil and gas industry, it is right that we invest that in the transition we need to make in energy,” she said, adding that the money would be spent on renewables, nuclear and other clean energy schemes.
However, she could not say exactly which tax revenues would be given to the new fund, or how much that might generate. “The chancellor will make those details clear in the budget,” she said.
While Labour’s 2024 election manifesto committed to a ban on new drilling licences in the North Sea, the companies behind Jackdaw and Rosebank oilfield project have sought approval for existing licences.
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The companies resubmitted their applications for environmental approval earlier this year. The Jackdaw field will start supplying gas to homes and businesses from the end of the month, the government said after approving the scheme.
Asked how confident he was that the Rosebank field would be approved, Neil McCulloch, the chief executive of Adura, one of the companies behind the plans, told the Press Association: “We’re very confident now.”
He said: “We’ve seen a decision made that there is a process that can result in a decision, but it’s a matter for the secretary of state and her team to examine the two fields separately. But we believe we’ve done as good a job in arguing our case with Rosebank as we did with Jackdaw.
“Obviously, the economic benefits of Rosebank are different. It’s a bigger field. It will last longer than Jackdaw, and so I’m sure she’ll take that into account when she makes her decision in terms of the jobs and economic impact for the UK.”
The Jackdaw announcement could boost Labour’s position in north-east Scotland, where much of the industry is based and where unions have been campaigning heavily for the permits to be granted. But it is likely to cause angst among some Labour MPs, especially those in seats where they face a challenge from the Green party.
A poll by Savanta for the climate group E3G, seen by the Guardian, found that nearly a third of voters say they would be less likely to vote Labour if it gave the go-ahead for more North Sea oil drilling. That includes almost exactly a third of those who voted Labour at the last election, and about half of 18- to 24-year-olds.
