North Sea Oil Industry ‘Voted’ on New ‘Climate Compatibility’ Drilling Policy, Minutes Show

The industry is hoping the rules can be finalised by the end of the year so another licensing round can take place.
North Sea Oil Industry ‘Voted’ on New ‘Climate Compatibility’ Drilling Policy, Minutes Show
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Oil Rig
North Sea oil rig. Credit: pxfuel

Oil and gas companies have been given the chance to “vote” on what a new climate test for North Sea drilling projects should look like, ahead of a public consultation on the scheme, official meeting minutes show.

The opportunity arose through a collaborative forum between the industry and its regulator, the Oil and Gas Authority – evidence that the sector is being allowed to “mark its own homework”, according to the Scottish Green Party.

The industry is also pushing for the government’s promised “climate compatibility checkpoint”, which will test proposed developments against climate targets, to be finalised by the end of 2021 to enable another licensing round to take place next year, the minutes reveal.

The findings, uncovered by DeSmog and Greenpeace and shared with Channel 4 News, come days before the UK is due to host the COP26 climate summit and follow a call from Scotland’s First Minister, Nicola Sturgeon, for a phase-out of oil and gas exploration. 

When approached for comment, the Department for Business, Energy and Industrial Strategy (BEIS) distanced itself from the discussions, saying they were “independent of government” and had “not been part of our policy-making process”.

“No decisions have been made and we will shortly launch a full, public consultation on the checkpoint which anyone will be able to respond to,” a spokesperson said.

Maintaining North Sea Exploration

The Exploration Task Force – a “collaborative structure” between the oil and gas industry and its regulator – lists its purpose as maintaining North Sea “exploration and activity” while supporting  the “transition towards a net zero carbon future and beyond”. 

Task Force members include “exploration managers” at BP, Shell, Chrysaor, and Total, and an operations manager at the industry body Oil & Gas UK (OGUK).  

The Task Force put out a statement yesterday calling for “responsible investment” in the UK’s oil and gas industry, which it said would “play a vital role in helping the UK to achieve net zero by 2050” by avoiding the import of higher-emission oil and liquified natural gas (LNG) from abroad. 

Minutes for a meeting of the group in June record that “members were asked to vote on which recommendations they thought should be priority to be included in the [climate compatibility] checkpoint (see meeting slide pack)”. 

Attendees included Mohamed-Amine Soudani, North Sea exploration manager at Total, Shell exploration manager Ben Hillier, and Jenny Morris, head of exploration at Chrysaor. BP’s exploration manager did not attend, according to the minutes. 

At the group’s September meeting, minutes record under “discussion” that “It is hoped that the Checkpoint design and implementation will be completed by the end of the year, to enable another licensing round to be initiated next year”. 

The September meeting minutes note that “stakeholder engagement” on the checkpoint was expected over the summer, adding “however, this timeline has slipped”. The government’s Net Zero Strategy published this month said: “We will be seeking input on the design [of the checkpoint] through a consultation to be published before COP26”. 

The UN climate summit begins on Sunday and BEIS confirmed to DeSmog that the consultation had not yet been launched.

‘Preferential Treatment’

Reacting to the news, Sam Chetan-Welsh, political campaigner at Greenpeace UK, said: “It is deeply concerning that an arm’s length body of BEIS consulted with the oil industry and has given them a vote on the design of the climate compatibility checkpoint before the consultation has launched. It’s obvious preferential treatment for industry over the public.

“If BEIS is committed to delivering a robust climate check, it should be just as perturbed as we are that the oil and gas industry is being given this favouritism,” he added.

A BEIS spokesperson hit back, saying: “These claims are nonsense. No decisions have been made and we will shortly launch a full, public consultation on the checkpoint which anyone will be able to respond to. We are not excluding anyone from the design process ​for the climate compatibility checkpoint​. 

“​Discussions ​on the Exploration Taskforce between the Oil and Gas Authority and other industry leaders are independent of government and have not been part of our policy-making process.”

BEIS noted that it held two roundtable discussions with climate and environmental NGOs last year, and that it has engaged with the independent Climate Change Committee, the Chief Scientific Adviser, and energy academics on the design of the climate compatibility checkpoint.

Official records show Business Secretary Kwasi Kwarteng met 16 times with North Sea producers and industry bodies between June and December 2020 to discuss the sector’s Transition Deal and its review of oil and gas licensing, while no meetings with environmental groups to discuss North Sea policies during that period are recorded.

DeSmog revealed last month that Kwarteng held 63 private meetings with fossil fuel and biomass energy producers between July 2019 and March 2021.

The OGA was set up as part of BEIS in 2015 and incorporated as a government company in 2016, with its sole shareholder being Business Secretary Kwasi Kwarteng.

A recent investigation by The Guardian and The Ferret revealed that eight of the 13 members of the board of directors and senior management team of the OGA previously worked in the fossil fuel industry. 

Mark Ruskell, climate spokesperson for the Scottish Greens, who recently entered government in a coalition deal with the SNP, said: “There is no question that the oil and gas industry cannot mark its own homework when it comes to climate impact, and it certainly has no interest in one of the most important steps nations need to take – transitioning away from fossil fuels.

“As the COP host, the U.K. Government should not be contemplating another round of licensing, it should be looking to the leadership of countries such as New Zealand, Denmark, Costa Rica and Ireland, who have begun the transition already.”

Climate Compatibility Checkpoint

The government’s proposed test for new drilling projects will only apply to new licences, meaning several oil and gas projects could be allowed to go ahead without meeting its conditions. 

Greenpeace also fears the checkpoint will not apply to “Scope 3” emissions, which cover those from burning fossil fuels, as opposed to operational emissions. In a recent court case, government lawyers argued that emissions from burning oil were “not relevant” to granting a North Sea drilling permit. 

The UK’s North Sea Transition Deal, produced by the government in concert with the oil and gas industry, has been criticised for allowing further drilling to take place. 

The heads of the United Nations and the International Energy Authority have said there should be no new oil and gas projects if global temperatures are to be kept to 1.5C. 

Campaigners have criticised BEIS and OGUK for citing the government’s independent climate advisors “out of context” in a bid to justify new developments in the North Sea.

When contacted for comment, an OGA spokesperson said: “The Exploration Task Force is an industry group whose priorities are to support maintaining UKCS exploration and appraisal activity in support of the transition towards a net zero carbon future and beyond. 

“It is ordinary practice for it to consider transformative developments within the industry and to provide its input into them, in the appropriate way, such as by responding to public consultation. Voting may be one way for the Exploration Task Force members to decide whether, and if so how, to provide that input.” 

“The Exploration Task Force is interested in the climate compatibility checkpoint and is keen to submit its views for consideration once the consultation opens, alongside those of other stakeholders,” they added.

The OGA would not provide a copy of the “slide pack” containing the recommendations voted on in the June meeting.  

OGUK External Relations Director Jenny Stanning said: “OGUK welcomed the government’s decision in March to create a climate compatibility checkpoint for new exploration licences. Any recommendations we’ve made on the matter reflect our commitment to a rigorous approval process.

“We look forward to the consultation process opening to the public, industry and all other interested parties.”

The companies named did not respond to a request for comment.

North Sea Oil Industry ‘Voted’ on New ‘Climate Compatibility’ Drilling Policy, Minutes Show
Adam Barnett is DeSmog's UK News Reporter. He is a former Staff Writer at Left Foot Forward and BBC Local Democracy Reporter.

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