An oil well and a coal mine have had their futures thrown into doubt after the government dropped its legal defence of them in response to a landmark court ruling.
The Supreme Court ruled in June against planning approval for an oil project near Gatwick, a decision that experts said would impede other fossil fuel projects.
The ruling now appears to have claimed its first casualties. The new Ministry of Housing and the energy company Egdon Resources conceded on Thursday that approval for another scheme, an oil well near the village of Biscathorpe in Lincolnshire, was unlawful because it failed to consider the climate change impact from burning the oil.
Mathilda Dennis, a campaigner, said: “We’re delighted that all the hard work and campaigning over the last ten years has finally paid off, not just for the beautiful area of Biscathorpe, but we hope that it will also help and encourage other groups fighting similar battles.”
The High Court had heard a judicial review by Dennis against the government and Egdon Resources over the scheme, and was preparing its judgment. However, days after Angela Rayner was appointed communities secretary, her department has pre-empted the judgment by conceding that the Gatwick ruling spells the end for the Biscathorpe scheme too.
Advertisement
A letter seen by The Times shows that, under the planning process, no assessment of the emissions released by burning the oil from the Biscathorpe project had been made. “Following the Supreme Court’s decision … it is apparent now that the [planning inspector] erred in law,” the document said.
Egdon Resources was contacted for comment. The Planning Inspectorate declined to comment.
Separately, Rayner told two green groups that there had been an “error in law” over the previous government’s controversial approval of a coal mine in Cumbria. The Whitehaven project, planned by West Cumbria Mining, would be the country’s first coal mine in three decades. The government will now no longer oppose challenges by Friends of the Earth and another group when the case is heard by the high court next week. The decision may mean that the mine is not allowed to open.
Ed Miliband is set to ban new oil and gas exploration licences in the North Sea as part of Labour’s plans to scale back fossil fuel production.
Officials in the Department for Energy Security and Net Zero said that ministers were preparing to cancel future licensing rounds but would honour existing commitments to companies exploring new fields.
Advertisement
They said reports that Miliband had ordered an immediate ban on new drilling in the North Sea were “categorically untrue”.
In its manifesto Labour said that oil and gas production would continue “for decades to come” and it would not revoke existing licences managing fields “for the entirety of their lifespan”.
The Conservatives made future exploration of Britain’s fossil fuel reserves a key issue at the election pledging to legislate to guarantee annual licensing rounds. However, the bill was never passed and Miliband made clear that although Labour would honour existing contracts, it would not allow any further licences.
The policy change is understood to have left a small number of projects that were still being assessed by the North Sea Transition Authority (NSTA) in limbo.
As part of the 33rd offshore oil and gas licensing round, initiated by the last government, 76 oil and gas companies submitted 115 bids to drill for oil and gas across 257 “blocks” of the North Sea, Irish Sea and East Atlantic.
Advertisement
The NSTA said that these would boost UK oil output by 600 million barrels. A source said the vast majority of these licences had been assessed and granted and a decision had not been made on five at the time the election was called.
It is possible that these may now be rejected, but officials stressed that no decision had been taken. They denied claims that Milband had overruled officials to cancel the applications, which would have left the government open to legal action.
A spokesman for Miliband told The Daily Telegraph: “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.”
Offshore Energies UK, which represents the industry, warned that UK production was already falling at 8pc a year but this would accelerate to 15pc a year without new drilling, accelerating the surge in imports.
David Whitehouse, chief executive of Offshore Energies UK, said: “We remain deeply concerned that some of the new proposals being put forward for our industry will undermine the energy transition we all want to deliver.
Advertisement
“Labour’s leadership has recognised that North Sea oil and gas will be with us for decades to come and they have committed to managing this strategic national asset in a way that does not jeopardise jobs. They now need to deliver on their commitment to support our industry.”
