Equinor Warns UK Investment at Risk Over Delayed Oil and Gas Projects
Norwegian energy giant Equinor has cautioned that the UK could become an uninvestable market if crucial new oil and gas fields are not approved.
Equinor, a major energy company, has warned that the United Kingdom risks becoming an "uninvestable" market if the government delays approving new oil and gas fields. The company's concerns center on the future of the Rosebank and Jackdaw fields, which are currently awaiting a final decision.
Rising global energy prices have intensified the debate around the UK's energy security, with domestic production anticipated to decrease by half by 2035. The UK already depends on Norway for a significant portion of its gas supply. Norway, however, continues to grant new licenses for oil and gas exploration in its own North Sea waters, a move Equinor expects will maintain production levels there until the mid-2030s.
Anders Opedal, CEO of Equinor, expressed confidence that Prime Minister Andy Burnham's "pragmatic approach to oil and gas" would lead to the approval of both projects. Nevertheless, he described the current uncertainty as an "uncomfortable position."
"It's a political choice," Opedal stated, referring to the potential for increased domestic production. He highlighted that the North Sea oil and gas industry originated on the UK side, with similar geological conditions on both sides of the border and several fields crossing it.
Rosebank, located approximately 80 miles northwest of the Shetland Islands in the North Atlantic, is described as the UK's largest undeveloped oil and gas field, with estimates suggesting it holds up to 500 million barrels of oil and gas. The exploration license for Rosebank was initially granted 25 years ago, in 2001, with the discovery made in 2004. The final investment decision for the site is set for 2023, according to Equinor.
Both the Rosebank and Jackdaw fields were initially approved by the previous Conservative government. However, their progress was halted by a Scottish court ruling following challenges from environmental groups concerned about the climate impact. A public consultation on these sites concluded in August, and the final decision now rests with Energy Secretary Miatta Fahnbulleh.
Adura, a joint venture between Equinor and Shell, operates both Jackdaw and Rosebank. The Aberdeen-based firm Ithaca also holds a 20% stake in Rosebank. Adura has indicated that if approval is granted soon, the Jackdaw field could begin supplying gas to UK homes this winter, as its construction is reportedly "99% complete."