The Bill for Petroleum

Victor Anderson on Tory government landmines for Labour

The Government says it is sticking to the “net zero” target for 2050, but at the same time claims that is compatible with the policies Sunak announced recently which point in the opposite direction. One of these policies is the effort to extract more oil and gas from UK territory in the North Sea.

Rather than simply declare this year a new round of licensing for oil and gas exploration and extraction, it has decided it would be better to announce there are going to be new rounds every year. This creates a bit of extra hassle and potential embarrassment for a future Labour government, which instead of quietly just not announcing a new licensing round, will have to go through Parliament to repeal the new Offshore Petroleum Licensing Bill after it becomes an Act.

However rather than look completely unreasonable in the face of the climate crisis, two tests have been included in the Bill, which must be satisfied if a licensing round is to go ahead. They have obviously been designed to be easy to pass. But the consequence is that they make the Bill look very amendable: you just have to propose adding new tests.

One extra test could be that there has been no increase in global average temperature over the previous five years. Or it could be that UK housing stock has to have good standards of insulation, as otherwise money would be better spent on insulating houses than extracting oil.

Since any oil that gets extracted will be sold on the world market, it does not actually deliver any oil earmarked for UK consumption, and because of the scale of world production, new North Sea oil will have a negligible impact on oil prices. On top of that, the Bill is in any case completely unnecessary, as the Government and North Sea Transition Authority can start a licensing process whenever they like.

The Offshore Petroleum Bill is a highly political demonstration of the Government’s new wish to be seen to have turned against any even mildly “green” policies. The Tories these days are increasingly just about voicing and demonstrating “culture war” attitudes, to the environment and a wide range of other policy areas, rather than actually delivering anything for anyone (except for a very small and very rich section of the population). Instead of following the science, Sunak has opted for clutching at straws in the hope that something may come along to cut down the Labour majority at the next election. One of those straws is in the North Sea.