Gas from the North Sea will start flowing within weeks after Andy Burnham’s government approved drilling in the Jackdaw gas field.
Energy Security Secretary Miatta Fahnbulleh green lit the scheme on Wednesday and is now under pressure to back the separate Rosebank oil and gas field as a further sign of commitment to North Sea production.
The approval of Jackdaw is expected to increase domestic gas production by around 6 per cent at its peak, safeguard hundreds of jobs and provide an estimated £2.9bn economic boost.
But Fahnbulleh told BBC Radio Scotland on Wednesday that the gas “won’t lower energy bills this winter”, and a decision on the larger Rosebank oil field has yet to be taken.
The decisions have major consequences for Britain’s energy and climate policy, jobs and Labour Party politics, although they are unlikely to take money off household bills.
Here’s why.
What are Jackdaw and Rosebank?
Jackdaw is a gasfield 150 miles off Aberdeen, while Rosebank is 80 miles north-west of Shetland and predominantly contains oil reserves.
Both fields had been waiting for a fresh ministerial decision since January 2025, when the Court of Session in Edinburgh ruled that they had been unlawfully approved.
While the Labour manifesto pledged not to approve new licences, it said it would honour existing ones.
The court said that the Government had failed to consider the climate impact of burning the oil and gas extracted from the fields and that a more detailed climate assessment and fresh approval was required before production could start.
The matter had been sitting for months on the desk of Fahnbulleh’s predecessor, Foreign Secretary Ed Miliband, because the decision about whether to approve or not is a “quasi-judicial” responsibility of the energy secretary.
What has Fahnbulleh decided?
Prime Minister Andy Burnham has struck a different tone to drilling in the North Sea compared to Sir Keir Starmer and Miliband, who generally stood in the way of new production.
Fahnbulleh announced on Wednesday that, “following careful consideration of all relevant factors”, she had agreed the regulator can grant consent for gas to be produced at Jackdaw.
She said the decision is “compatible with our legally binding climate commitments”, and that the Government remains “resolute in ending new licences for oil and gas”.
The i Paper revealed on Tuesday that approval was imminent. It had been expected in mid-September, but ministers reportedly held off until after the Holborn and St Pancras by-election on 8 October.
Rosebank is a “different proposition” because its oil will be exported rather than remain in the UK, Fahnbulleh told BBC Radio Scotland, adding that “no decision has been taken”.
Would the projects cut bills?
The consensus is that Jackdaw and Rosebank would not lower bills in themselves. The same goes for expanded drilling in the North Sea more broadly.
Oil and gas from British waters is sold on global markets, and because the North Sea is a “mature” basin where most of the large and easily accessed reserves have already been removed, the UK cannot drill enough fuel to lower world prices. In essence, the price of gas and oil is out of the UK’s hands, even for the resources it produces itself.
Fahnbulleh has now acknowledged this herself, telling BBC Radio Scotland that Jackdaw “won’t lower energy bills this winter” and arguing instead that it makes sense on energy security grounds.
However, advocates of drilling claim it could indirectly lower bills. Expanded production would generate tax revenues and it would be up to the Government to decide what to spend this on – including potentially subsidising bills or rolling out energy efficiency enhancements to homes.
On the day Jackdaw was approved, Chancellor John Healey announced an Energy Wealth Fund, which the Government says will use tax revenue from North Sea oil and gas to invest in renewable and low-carbon energy projects. Burnham said ring-fencing those proceeds was part of an approach that would “crucially – bring down bills”.
What other potential upsides are there?
The clearest one is jobs, with the developers of the fuel fields claiming they will support 3,500 jobs at peak construction and hundreds more in the wider supply chain.
That figure covers both fields combined. However, Greenpeace UK’s head of politics, Ami McCarthy, has said Jackdaw alone “will create just 27 full-time jobs”.
But Adura chief executive Neil McCulloch told BBC Radio 4’s Today programme that this reflects only the people working on the platform, and that the field will support just under 300 jobs linked to a nearby processing hub.
Some economists argue that producing more of our own oil and gas rather than importing it from foreign countries would improve the UK’s balance of payments, which would strengthen the pound and have a positive impact on inflation.
There is also an energy security angle. North Sea advocates argue that producing a greater share of our energy domestically is more secure than relying on imports, which can be disrupted by conflict – as we are seeing in the Middle East – or potentially wielded against the UK as a political weapon by exporting nations.
Fahnbulleh said Jackdaw will “help minimise the UK’s use of imported higher emission fuels as we continue our transition to renewables and nuclear”.
What about the climate impact?
Environmental campaigners argue that the projects will not materially improve energy security and that the climate impact is unacceptable. Doug Parr, Greenpeace UK’s chief scientist, has said that “any new oil and gas field approval is wholly incompatible with keeping global warming to 1.5°C”.
However, even without the fields, the UK will continue to use oil and gas for decades to come and the fuel will have to come from somewhere if not the North Sea. In its updated environmental impact assessment, Adura said that using gas from Jackdaw would be less carbon-intensive than relying on liquefied natural gas (LNG) obtained from fracking in the US. According to its assessment, imported American LNG generates about 20 per cent more emissions compared to gas drilled domestically.
Uplift’s executive director, Tessa Khan, said Jackdaw would provide “around just 2 per cent of our gas demand for roughly ten years”, and that “the defining test is Rosebank”. Equinor’s own assessment estimates that burning Rosebank’s oil and gas would release up to 250m tonnes of CO2 over 25 years.
How will it affect the internal politics of the Labour Party?
Labour’s 2024 general election manifesto – which Burnham has pledged to stand by – vowed not to issue new oil and gas exploration licences. However, because Jackdaw and Rosebank were originally approved in 2022 and 2023 respectively, they do not count as new licences.
The Parliamentary Labour Party is divided on the future of the North Sea. Jackdaw’s approval has been welcomed by Labour-supporting unions. GMB general secretary Gary Smith said Burnham’s government “deserves real credit”, while Unite’s Sharon Graham said it gives “a bit more time” to plan new jobs for North Sea workers.
Rosebank is a harder test, with Uplift saying more than 80 MPs and MSPs have come out against it.
Even with Jackdaw approved, some Labour MPs want the Government to go further by scrapping the ban on new licences altogether. This seems unlikely to happen under Fahnbulleh, who is a close ally of Miliband’s and previously urged the UK to achieve net zero by the mid-2030s rather than 2050.
One pro-drilling MP told The i Paper that the new ministerial team in the Department for Energy Security and Net Zero – which includes another Miliband ally, Polly Billington – “feels like little change at all”. They added: “I worry that it makes a mockery of [Burnham’s] reindustrialisation pledge.”