The new climate rules for UK oil and gas projects

The rules governing how potential new UK oil and gas projects are assessed are finally changing.

Thanks to a ruling by the Supreme Court in June 2024, regulators must now consider the impact of burning the oil and gas extracted from a project when assessing its environmental impact. Although these combustion emissions, or ‘scope 3’ emissions account for the vast majority of the climate harm from new oil and gas fields, they were not previously assessed.

The government has responded to the Supreme Court ruling by launching a consultation on how they should factor scope 3 emissions into applications for new fields. This closed last month, with the new rules due this Spring.

To be credible, the new rules must:
1.  Rationally assess new UK oil and gas projects in the context of global climate limits
2. Count emissions from new oil and gas projects in their totality
3. Reject false proposals to mitigate combustion emissions.‍

1.  Rationally assess new UK oil and gas in the context of global climate limits 

Decision-makers must consider new UK projects in a global context. The global carbon budget is finite and there is strong scientific consensus on the remaining size of this budget. There is now significant scientific evidence that the emissions from burning the reserves in existing oil and gas fields globally would push us past 1.5°C. Arguments for new projects assume that governments will not meet this shared climate goal. 

Advocates for more oil and gas drilling claim that emissions from a single, new oil and gas project – for example Rosebank – are ‘a drop in the ocean’ compared to global or even domestic emissions and therefore, each project would have a negligible impact on global climate change. 

But this is a drop in an otherwise already very full bucket - a bucket already set to overflow with existing projects. The new rules from the Government must ensure that projects are assessed against global climate budgets and consider the cumulative picture, taking into account the already committed emissions from existing fossil fuel projects around the world.

2. Count emissions from new oil and gas projects in their totality

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It seems an obvious point that, when assessing the emissions from a new oil and gas development, all of the combustion emissions from the project should be included and that these will be compared against a scenario where the project does not go ahead, i.e. no emissions will be produced. 

Advocates for more oil and gas drilling, however, propose alternative ways of assessing the emissions from new North Sea developments, in order to minimise their true climate impact. For instance, the industry often argues that if a project doesn’t go ahead in the UK, it will just be ‘substituted’ for production elsewhere, which might be more carbon-intensive. In other words, stopping new UK drilling would just lead to ‘dirtier’ production elsewhere.

The idea that leaving North Sea oil and gas in the ground automatically results in a corresponding increase in production elsewhere is a total misconception. The evidence points to the contrary, as noted by the Supreme Court ruling. In almost all cases, cutting oil production reduces total global emissions. 

3. Reject false proposals to mitigate combustion emissions

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When it comes to oil and gas extraction, combustion emissions – unlike production emissions – cannot be avoided, prevented or reduced if a project goes ahead. Once reserves are extracted and refined, they are then burned releasing emissions that are impossible to avoid, a point made by the Supreme Court. 

Nor is it appropriate or possible to “offset” emissions from burning North Sea oil and gas. Aside from the many documented failures of offset schemes to deliver provable reductions in emissions, nature-based offsets, such as forests, which absorb low levels of carbon slowly, cannot cope with the sheer volume of CO2 that is released through the burning of oil and gas. 

Similarly, carbon capture and storage technologies are highly uncertain and not operating at scale, are only appropriate for capturing scope 3 emissions in very limited circumstances, and are anyway needed to remove existing emissions, rather than additional ones.

Ultimately, the only way to reduce climate harm from new oil and gas developments is to leave the reserves in the ground.

What do the new rules mean for the Rosebank oil field?

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The proposed Rosebank oil field – consent for which was ruled unlawful in January –  must now pass through the new regulatory process, if its developers want to proceed with the field. Once the new rules are published, Rosebank’s owner Equinor can reapply to the UK government, this time including the emissions that will be produced from burning its reserves, as set out in the new rules. 

The climate pollution from burning Rosebank’s 500 million barrels of oil and gas would amount to more than the combined annual CO2 emissions of all 28 lowest-income countries in the world. Any credible assessment of Rosebank’s emissions would see the application refused for not being compatible with safe climate limits. 
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Uplift’s full briefing on the new climate rules for UK oil and gas projects can be accessed here.

To learn more about the next steps Rosebank faces see Rosebank and the changing regime for oil and gas.

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