Labour’s manifesto pledge to end new North Sea oil and gas projects is facing mounting pressure, with industry sources suggesting the government may allow new drilling as early as this autumn. The Guardian has learned that senior government advisers have indicated to investors that projects close to existing pipeline infrastructure could proceed, despite the election promise.
The potential policy shift comes as Nigel Farage’s Reform UK targets discontent in Aberdeen, the heart of the oil and gas industry. Farage has vowed to reverse Labour’s ban on new drilling as a “day one” priority if elected in 2029, describing net zero as “lunacy”. Labour has already performed U-turns on benefits and winter fuel allowances, fueling speculation that North Sea policy could be next.
Industry sources claim that Treasury and No 10 advisers have “quite openly” signaled a looser interpretation of the manifesto commitment. One investor said: “Myself and a number of colleagues have been told that the government is moving towards the idea of allowing new licences.” However, this contradicts the stance of Energy Secretary Ed Miliband, who has called new oilfields “climate vandalism”.
The North Sea contributes £25bn annually to the UK economy and supports over 200,000 jobs, according to trade group Offshore Energies UK. With domestic production being replaced by imports from Qatar and the US, the Treasury is reportedly anxious to protect jobs and tax revenues. Labour’s manifesto did not revoke existing licences, leaving room for projects like Rosebank, Jackdaw and Cambo to proceed without breaching the pledge.
YouGov polling in March showed 61% of UK adults support the net zero target by 2050, but the government faces a delicate balance between green commitments and economic pressures. Internal rows between DESNZ and the Treasury are expected, with sources predicting the Treasury will ultimately prevail with support from No 10.
