The British government  outlined an agreement with the fossil fuel industry to move away from extracting oil and gas from waters around the UK.

The British government  outlined an agreement with the fossil fuel industry to move away from extracting oil and gas from waters around the UK, but against the hopes of environmentalists it did not ban new licences for drilling in the North Sea.

In December 2020, Denmark became the first country to announce that it would phase out oil and gas production altogether by 2050, and would no longer grant new drilling licences. Environmental organisations had hoped that the UK would do the same, especially as it will host the UN climate summit COP26 in November. The extraction process alone accounts for around 3.5 per cent of the UK’s greenhouse gas emissions, not counting the pollution produced later when these fuels are burned.

Under the agreement outlined on Wednesday, the government and the private sector will jointly invest £16 billion by 2030 to help the mining sector make the energy transition and gradually shift away from fossil fuels. The condition is that the sector reduces its greenhouse gas emissions by 50 per cent by 2030.

According to the British government, the package of measures agreed as part of the deal will reduce emissions from oil and gas extraction by 15 million tonnes by 2030, equivalent to the annual emissions from 90 per cent of British homes, while maintaining 40,000 jobs.

However, there will be no ban on new extraction licences. Instead, ‘climate checkpoints’ are to be introduced to verify whether individual applications are in compliance with the UK’s climate change targets before each planned licensing round.

Consideration will be given to the UK’s domestic oil and gas demand, projected production levels in the North Sea, the availability of clean energy and the sector’s progress towards emissions reduction targets. If the checkpoints to be set this year indicate that new oil and gas production would undermine the UK’s climate targets, the licensing round will not proceed.

“Today we are sending a clear message to the world that the UK will be a clean energy nation. We will not leave oil and gas workers alone in the irreversible transition away from fossil fuels. We will power a green industrial revolution by targeting the next generation of clean technologies that Britain needs in order to support the green economy,” said Business and Enterprise Minister Kwasi Kwarteng stated.

Environmental organisations have expressed disappointment at the lack of a ban on new licences. In their view, this undermines the credibility of the UK government’s actions in the context of the COP26 summit. “The refusal to rule out new oil and gas licences when the evidence is already clear that they are incompatible with UK climate commitments is a colossal failure of climate policy in the year of COP26,” Mel Evans of Greenpeace UK said.