The government has approved drilling at the Jackdaw gasfield, part of Andy Burnham's efforts to demonstrate a growth strategy ahead of the Budget. The decision will be framed as evidence of decisive "pragmatism" from the new prime minister and John Healey, the chancellor, who is expected in Aberdeen. Supporters argue that North Sea gas has lower carbon content than imports from the Middle East, which require liquefaction and long-distance shipping. Even under Net Zero 2050, the UK is expected to use gas for decades, ideally with carbon capture. The only opposition came from those advocating restraint on carbon emissions as a global example. A decision on the more controversial Rosebank oilfield remains pending.
Contrary to appearances, this does not represent a major departure from Keir Starmer's policies. His manifesto pledged to end new exploration licences, a stance that continues. Starmer also permitted "tiebacks" allowing drilling near existing hubs, which Burnham will formalise in an upcoming energy independence bill. Both Jackdaw and Rosebank had pre-existing licences from the previous Tory government, placing them outside the manifesto ban. The Court of Session previously ruled the approvals unlawful due to inadequate climate impact assessments.
Energy secretary Miatta Fahnbulleh's approval of Jackdaw is less politically risky than breaking manifesto promises. The key difference between Burnham and Starmer is messaging: Burnham is more vocal in defending the decision. Those pleased include business leaders, the Tories, and Labour MPs; opponents include environmental groups and the Green Party.
Meanwhile, Ed Davey hinted at an early election, possibly in December, suggesting political turbulence ahead.
Source: Financial Times Companies · Summarized by HeadlinesBriefing