Key facts
- North Sea oil producers are pushing for the UK's windfall tax to be scrapped.
- The industry wants approval for the Rosebank and Jackdaw projects.
- Offshore Energies UK (OEUK) suggests replacing the Energy Profits Levy (EPL) with an Oil and Gas Revenue Levy (OGRL).
- OEUK estimates new projects could attract £50 billion in investment.
- Environmental groups like Uplift argue new drilling would harm the climate and offer little benefit to consumers.
- Prime Minister Andy Burnham is considering the proposals with a "pragmatic approach."
North Sea oil and gas producers are urging Prime Minister Andy Burnham to scrap the current windfall tax and approve new drilling projects, arguing it would significantly benefit the U.K. economy and energy security. Offshore Energies UK (OEUK) has proposed replacing the existing Energy Profits Levy (EPL) with an Oil and Gas Revenue Levy (OGRL) that would only be triggered during price spikes. OEUK estimates that approving controversial projects like Rosebank and Jackdaw could unlock 111 new projects and attract £50 billion in investment.
However, environmental groups, including Uplift and Global Witness, strongly oppose these proposals. Uplift has dismissed the OEUK report as a "fantasy," arguing that the North Sea is an "ultra-mature" basin with limited reserves and that new drilling would not lower consumer bills or significantly improve energy security. Global Witness research suggests the proposed OGRL could raise substantially less revenue than the current EPL by 2030, especially if oil prices remain moderate.
Simone Rossi, head of EDF Energy, has voiced support for increased North Sea production, calling new projects a "no-brainer" that aligns with net-zero goals and could create jobs. He also suggested that locally produced fossil fuels have lower emissions than imported ones due to reduced transportation.
Prime Minister Andy Burnham has not yet made a decision on the Rosebank and Jackdaw projects, which are owned by a joint venture between Equinor and Shell. He has indicated a willingness to take a "pragmatic approach" to the North Sea.