UK approves new gas field in the North Sea amid concerns about energy security
By Hanna Ziady, CNN
London (CNN) — The UK government has approved the development of a major new gas field in the North Sea as the war in the Middle East deepens concerns about energy security globally.
The decision, which is likely to anger environmental campaign groups, comes three months after US President Donald Trump described Britain’s North Sea oil and gas reserves as “invaluable” and welcomed any potential plans to allow drilling.
The Jackdaw gas field, located 150 miles east of Aberdeen in Scotland, “will start to supply gas to British homes and businesses from as early as the end of this month,” the government said in a statement announcing its decision to greenlight production.
“The Jackdaw decision is expected to increase domestic gas production by around 6% at its peak – supporting the UK’s gas supply over its lifespan of up to 11 years, boosting our energy security, protecting hundreds of jobs and adding an estimated £2.9 billion ($3.8 billion) to the UK economy,” the statement added.
The government also announced the creation of a new Energy Wealth Fund, which it said would use tax revenues from North Sea oil and gas to invest in renewable and low carbon energy projects. The fund will start with an initial cash injection of £2 billion ($2.7 billion).
Jackdaw to have limited impact on energy bills
The British government has faced criticism from some corners that its climate policies, which include a binding commitment to achieve net zero greenhouse gas emissions by 2050, have hurt industry and energy security.
Trump, for his part, has described the North Sea as “one of the Greatest Sources of quality Oil on Earth.” In a post on Truth Social in July, he said drilling North Sea oil and gas fields “will make the United Kingdom, from a Poverty Stricken Disaster, to one of the Richest Countries anywhere in the World!”
In reality, however, greater North Sea production may not materially boost energy supply or bring down prices.
“Jackdaw would reduce import dependence and improve supply resilience, but only to a limited extent,” said Sam Street, a director at consultancy Frontier Economics, who co-authored two recent reports into North Sea oil and gas production. “The UK would continue to rely on imports, including from Europe.”
More domestic production would also do little to bring down energy bills. “UK gas prices are closely linked to European prices, which are in turn influenced by the (global) cost of liquefied natural gas,” he told CNN.
“Producing more gas domestically does not create a separate source of cheap energy for UK consumers,” he added. “Domestic producers have no reason to sell materially below the price they could achieve in European markets.”
The-CNN-Wire
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