Two of the North Sea’s stalled assets can make a major contribution to the energy security of Britain and Europe, according to an industry leader.
Drilling in the Jackdaw and Rosebank fields, which are undergoing environmental assessments, would bring billions in tax revenues and shore up jobs currently being lost in the industry, says Neil McCulloch, the chief executive of Adura.
The company is the biggest independent oil and gas operator in the region and at the weekend submitted its response to the UK regulator’s request for further information.
Adura says Jackdaw and Rosebank can make up 10% of UK natural gas production combined. Jackdaw alone could provide over 6% of UK gas supply by this winter – enough to heat 1.4 million homes.
Rosebank could represent 4% of UK gas production and 10% of oil production from the UK Continental Shelf (UKCS), making a significant contribution to security of supply in North-West Europe for refined products such as jet fuel and motor fuels.
Together, they would support £28.7 billion of economic activity, 3,500 jobs at peak construction and 880 throughout production, with benefits across Scotland and the UK. They would also generate £1.4bn in tax revenues before the end of this parliament and £3.8bn before 2034.
Development work has been under way in line with a court ruling that the government had failed to meet environmental impact concerns. More than £3 billion has been invested to date in the two fields in expectation that they will be given the go-ahead.
However, the Energy Security Secretary Ed Miliband has shown little enthusiasm for approving the sites, despite changing global circumstances which have disrupted supplies and forced up energy prices.
Oil and gas still supply around 75% of the UK’s energy needs and without consent for both Rosebank and Jackdaw, the UK will be required to source the equivalent volume from international markets with higher carbon intensity.
Across Adura’s portfolio, including Jackdaw, Rosebank and new developments, average production emissions intensity could be as little as half the UKCS average and around eight times lower than emissions intensity associated with imported LNG.
The Jackdaw platform is already installed in the North Sea and in the final stages of preparations for starting up. It is tied-back to the existing Shearwater Hub, using infrastructure already in place to bring gas onshore at St Fergus in Aberdeenshire. The retrofitted Petrojarl Rosebank Floating Production, Storage and Offloading (FPSO) vessel arrived at its location West of Shetland last month.
Mr McCulloch said: “The North Sea has helped to power Britain for more than half a century. In Jackdaw and Rosebank we have two advanced projects of national importance that can define the next chapter.”
He said the company had submitted its responses “with great pride in the engineering effort – from Adura, our co-venturer in Rosebank, Ithaca Energy, and a truly world-class energy supply chain – that has positioned Jackdaw and Rosebank ready to make a major contribution to the energy security of Britain and our European neighbours.”
He added: “There is a material economic opportunity that has already been realised through multibillion pound investment to reach this point – and can be sustained throughout the production life of both fields, representing thousands of jobs and over £28 billion in added value to the UK economy.
“With timely approval of Jackdaw and Rosebank, Adura can help unlock significant benefits: the energy that Britain needs – at lower associated emissions and within existing carbon budgets – alongside a major economic advantage in the national interest.”
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