Rosebank Oil Field Was Just Approved. Here’s Why It’s A Big Deal

Developers just got the green light to work on the divisive oil field known as Rosebank – prompting major environmental concerns.

Here’s what you need to know, and why this new decision is so controversial.

What is Rosebank?

Rosebank is 80 miles west from Shetland and the UK’s largest untapped oil field with an estimated 300 million barrels of the fossil fuel inside.

At its peak, it could produce 69,000 barrels of oil a day, and harvest 44 million cubic feet of gas per day in its first 10 years.

The oil and gas regulator, the North Sea Transition Authority, said that this development would be in “accordance with our published guidance and taking net zero considerations into account throughout the project’s lifecycle”.

Rosebank’s owners, Norwegian state energy company Equinor and British oil and gas company Ithaca Energy, say that if production begins in 2026, the “largest undeveloped field in the UK” could make up 8% of the UK’s total oil production over the following four years.

The executive chair of Ithaca Energy, Gilad Myerson, also told Times Radio on Wednesday that the decision “makes a lot of sense”, because the UK is likely to relay on fossil fuels for decades to come.

Prime minister Rishi Sunak praised the move, saying it was the “right long-term decision for the UK’s energy security”.

Scotland’s first minister Humza Yousaf said he was “disappointed” and called it “climate denial” from Westminster.

The chief executive of the Aberdeen and Grampian Chamber of Commerce, Russell Borthwick, said it was a “welcome shot in the arm for the UK energy sector”.

Why is Rosebank so divisive?

Anti-Rosebank protesters congregated outside UK government offices in Edinburgh shortly after the decision was announced on Wedsnesday.

There are two main arguments around this oil field: the environmental consequences, and the impact it may have on the economy.

Environment

In August, 50 MPs and peers from across the political spectrum warned that the oil field could produce 200 million tonnes of CO2, and called on energy secretary Grant Shapps to block it.

After the development of Rosebank was given the go-ahead, the Scottish Green Party – SNP’s partners in the Scottish government right now – said it was “the worst possible choice at the worst possible time”.

Meanwhile, campaigning community Friends of the Earth described it as “yet another colossal failure of leadership” from the government.

“Giving the green light to Rosebank will send UK emissions soaring while failing to boost energy security or reduce bills,” campaigner Danny Gross claimed.

He added: “The government should be investing in real solutions to the challenges we face by prioritising homegrown renewables and developing a nationwide insulation programme – not pouring more gas and oil on a burning planet.”

Greenpeace UK climate campaigner Philip Evans also claimed: “Rishi Sunak has proven once and for all that he puts the profits of oil companies above everyday people.

“We know that relying on fossil fuels is terrible for our energy security, the cost of living, and the climate. Our sky-high bills and recent extreme weather have shown us that.”

The International Energy Agency said back in 2021, that all new fossil fuels should be stoped if we were to reach net zero by 2050.

Economy

MPs and peers also warned Shapps last month that much of the development costs for Rosebank would fall to taxpayers.

Scotland’s energy secretary Neil Gray, an SNP MSP, has also warned that most of what will be extracted will actually go overseas – prompting questions over whether it will actually help the UK economy as promised.

Friends of the Earth’s campaigner, Gross, echoed his words, saying: “The main beneficiaries of this decision will be the fossil fuel firms who have been raking in bumper profits thanks to outrageous tax-breaks and our reliance on costly gas and oil – while cash-strapped households are left to pay the price.”

Around 80% of UK oil production is currently exported, according to government statistics, and critics believe the oil in Rosebank is not the type usually used in the UK.

How have the Rosebank developers responded to backlash?

However, Myerson told Times Radio: “The majority of the oil and oil products will find its way to the UK market. The UK is currently a net importer of both oil and gas.”

He also suggested that it will help the job market, saying: “Rosebank will be providing 1,600 jobs. And then obviously the lower overall cost of energy. So I think from various angles when you look at the project it makes a lot of sense for the UK to develop its own oil and gas.”

He also alleged that the UK is going to be using oil and gas into the 2050s and 2060s.

So, he claimed the UK was left with a choice and said: “Do we want to starve ourselves of energy or do we want to produce it locally or do we want to import?”

Supporters of the oil field have pointed to analysis from the government’s independent climate advisers, the climate change committee.

In a 2022 report, the experts admitted that UK extraction has a relatively low carbon footprint, and predicted the UK will continue to be a net importer of fossil fuels for the foreseeable future.

It added that therefore “there may be emissions advantages to UK production replacing imports” – although it noted the extra gas and oil would support a larger global market for fossil fuels, too.

What has the government said?

Energy security secretary Claire Coutinho said: “We are investing in our world-leading renewable energy, but, as the independent climate change committee recognise, we will need oil and gas as part of that mix on the path to net zero and so it makes sense to use our own supplies from North Sea fields such as Rosebank.”

She said it would create jobs and boost the economy, helping the UK have greater energy independence “making us more secure aggainst tyrants like Putin”.

“We will continue to back the UK’s oil and gas industry to underpin our energy security, grow our economy and help us deliver the transition to cheaper, cleaner energy.”

Earlier this year, the government approved of hundreds of new licences for oil and gas exploration in the North Sea.

What will happen next?

Labour have said that it would not revoke the licence if it won the next general election, but acknowledged moving away from fossil fuels is key due to the volatility of those prices.

Meanwhile, Ithaca Energy indicated that this might just be the first of many new oil fields. 

Myerson told Times Radio: “We were planning to sanction not only Rosebank, but also Cambo and Marigold and Fotla and a few other fields.

“We’ve slowed down that investment profile because of the lack of fiscal stability… we’re working very constructively with the government to try to ensure that there’s a fiscal environment that supports the industry…if that is the case, we will probably progress and develop additional fields.”