Thursday, July 25, 2024

Miliband overrules officials with immediate ban on new North Sea oil

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Ed Miliband has ordered an immediate ban on new drilling in the North Sea in a decision that overrules his own officials and risks triggering a wave of legal action.

In an unusual intervention into what is typically an apolitical process, the Energy Secretary has told regulators not to approve a new round of drilling that was slated for confirmation in the coming weeks.

His decision to block the licences means that companies will have wasted millions of pounds on preparing their bids, with experts warning they are likely to take legal action as a result.

The decision followed crisis meetings yesterday between Mr Miliband and his aides after The Telegraph asked for updates on outstanding drilling licence applications. 

The applications, from companies seeking to exploit up to 35 new North Sea areas, were submitted as part of the 33rd offshore oil and gas licensing round initiated by the last government in autumn 2023.

It saw 76 oil and gas companies submitting 115 bids to drill for oil and gas across 257 “blocks” of the North Sea, Irish Sea and East Atlantic. The NSTA said these would boost UK oil output by 600 million barrels.

Bids for up to 35 areas were still awaiting a decision from the North Sea Transition Authority (NSTA), the regulator, when the election was called.

On Wednesday afternoon the NSTA said that applications were still being considered, despite the change in Government. A spokesman reiterated the NSTA’s pre-election statement that: “Further consideration is being given to a small number of remaining applications and a few more may be offered at a later date.”

However, Mr Miliband subsequently instructed the NSTA to block them all.

In a terse statement issued late on Wednesday, his spokesman said: “We will not issue new licences to explore new fields, and will not revoke existing oil and gas licences. We will manage existing fields for the entirety of their lifespan.”

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