Today’s green light for the £2.1billion Jackdaw gas project is a first step towards unlocking £50 billion of investment in new North Sea oil and gas production to help meet UK demand, says Offshore Energies UK.
Jackdaw will be able to produce gas within weeks – in time for the coldest months of winter and will boost domestic supply by 6% – equivalent to the volume of gas required to heat approximately 1.4 million UK homes.
The decision follows a rigorous regulatory process led by the Offshore Petroleum Regulator for Environment and Decommissioning (OPRED), including extensive public consultation and consideration of the latest environmental evidence.
Jackdaw will be among the lowest-emission developments in the UK North Sea, with production emissions around half the UKCS average and approximately eight times lower than imported liquified natural gas (LNG).
Approval of Jackdaw is an important step forward, but the bigger opportunity is unlocking the wider pipeline of more than 100 North Sea projects including the Rosebank oil field. These projects will support thousands of jobs, strengthen UK energy security and reduce growing reliance on imported energy.
The UK currently relies on imports for around 40% of its energy needs, and that dependence is set to grow unless we invest in domestic supply. Latest forecasts suggest the UK will still require more than10 billion barrels of oil and gas between now and 2050, even as we accelerate the transition to lower-carbon energy sources and net zero.
The offshore energy sector has repeatedly demonstrated that, in the right fiscal and regulatory environment there are significant investment opportunities to support jobs, strengthen the UK supply chain and deliver economic value across the country.
Unlocking this wider pipeline could bring forward more than three billion barrels of additional domestic production, helping the UK meet at least half of its oil and gas demand up to 2050 from homegrown resources rather than imports
Any future production from the UK Continental Shelf would proceed following approval under a regulatory regime that explicitly incorporates Scope 3 emissions into decision-making and is consistent with the UK’s climate goals.
Ahead of next week’s budget, Offshore Energies UK is calling for the introduction of the Treasury’s proposed Oil and Gas Revenue Levy (OGRL) – a permanent windfall tax triggered during periods of high prices – which would provide the stable and predictable fiscal framework needed.
Industry analysis shows that introducing the OGRL in 2027 and unlocking additional investment could generate £14.9 billion in additional tax revenues over the next decade, while strengthening energy security, supporting jobs and reducing reliance on imports.
David Whitehouse, chief executive of Offshore Energies UK said:
“The Prime Minister has said the question is not whether we use oil and gas, but where it comes from. The answer, surely, is our own North Sea, where it is produced under some of the highest environmental standards in the world, supporting UK jobs, creating value across the UK economy and sustaining the supply chain needed to deliver our energy future.”
“Today’s decision on Jackdaw is an important step forward. But securing Britain’s energy future means unlocking a wider pipeline of North Sea projects that could deliver £50 billion of investment, strengthen energy security, support jobs and supply chains across the UK, and help meet more of the country’s future energy needs from domestic production rather than imports.
“Britain spent £84 billion on energy imports last year, equivalent to almost 3% of GDP. That means jobs, investment and economic value flowing overseas. The right choice is to back domestic production from the North Sea, not greater dependence on imports.
“We import historic amounts of energy. More than 40% of what is used here comes from imports.
“On every measure, from energy security and emissions to jobs and economic value, the right and responsible choice is to prioritise domestic production.
“We want the UK government to be supportive of domestic production over imports, and approval of Jackdaw is a step in that direction.”
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