The British government has given the green light for production at the Jackdaw gas field in the North Sea to begin, bringing an end to an approvals process that had stalled on climate concerns, and priming operations to kick off within weeks.
The Jackdaw project has been entangled in legal disputes amid opposition on environmental grounds, and awaiting final government approval for some time. Hopes for progress were raised when newly installed U.K. Prime Minister Andy Burnham promised a "pragmatic" approach to new drilling in the North Sea after global conflicts highlighted the country's vulnerability to global energy shocks.
Wednesday's approval opens the door for operator Adura to start gas production, with the joint venture between London-listed Shell and Norway's Equinor expecting first gas within weeks.
At its peak, the field will increase U.K. domestic gas production by around 6% and add an estimated 2.9 billion pounds, or $3.88 billion, to the country's economy, the government said. Adura has estimated the field has enough gas to heat around 1.4 million homes at peak production. At current prices, Jackdaw could generate 1.5 billion pounds in tax for the Treasury, Wood Mackenzie's Gail Anderson said.
For the U.K.'s ruling Labour Party, the permit has been a contentious issue. It has sought to position itself as environmentally conscious and promised to build out renewable forms of energy in a bid to reduce the country's reliance on fossil fuels and tackle climate change.
But a renewed focus on energy security, rising hydrocarbon prices and fears that a failure to approve the field could further undermine investment elsewhere across the country's oil sector have tipped the balance in favor of approval.
The country is reliant on piped natural gas and the more emissions-intensive shipments of liquefied natural gas.
"At a time of global instability, homegrown energy can be a source of national strength," the government said Wednesday.
The Jackdaw project, located about 155 miles east of Aberdeen, Scotland, was given approval in 2022. A legal challenge from climate group Greenpeace led to a court ruling that halted the project and required new environmental assessments and ministerial approval to proceed.
Conflict in the Middle East has caused gas prices to soar, and while the field isn't expected to lower prices, it had become harder for the government to justify not drilling off its own coast. President Trump has also weighed in, earlier this year urging the U.K. to "drill, baby, drill" in the North Sea.
Focus will now shift to Rosebank, an offshore oil field around 80 miles northwest of Shetland that is also in the midst of a delayed approvals process. Also operated by Adura, the project is forecast to start up in 2027 but its approval is seen as more contentious because it will drill for oil rather than gas.
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