Environmental challenge to new oil and gas extraction in the North Sea

24/07/23

Greenpeace & Uplift v Secretary of State for Energy Security and Net Zero & the Oil and Gas Authority

The Administrative Court will this week hear a challenge to decisions made by the Secretary of State for Energy Security and Net Zero (“SoS”) and the Oil And Gas Authority (“OGA”) to approve a new round of licensing of oil and gas extraction in the North Sea.

The claims arise in the context of the urgent, global threat posed by anthropogenic climate change, of which the emission of greenhouse gases (“GHGs”) is the principal cause.

The challenge has been brought by two environmental campaign organisations, Greenpeace and Uplift. Their claims relate to a series of decisions which have resulted in the authorisation of a new round of licensing without the SoS or the OGA having assessed the GHGs emissions that would result from consuming the oil and gas extracted.

Specifically, the Claimants challenge (1) the SoS’s strategic environmental assessment (“SEA”) of the plan’s environmental implications, (2) the OGA’s decision to invite applications for production licences (“Licensing Round”), (3) the SoS’s decision to endorse the Licensing Round, and (4) the SoS’s adoption of a ‘Climate Compatibility Checkpoint’ (“Checkpoint”) intended to ensure that further oil and gas licensing is compatible with the UK’s climate objectives.

The legal framework relevant to the claims is laid down in the Environmental Assessment of Plans and Programmes Regulations 2004 (“2004 Regulations”). Under those Regulations, an SEA must be prepared prior to the adoption of a plan or programme relating to energy (reg. 5(2)). The SEA must describe and evaluate the likely significant effects on the environment of implementing the plan or programme (reg. 12(2)), and include the information reasonably required to understand the “likely significant effects on the environment including short, medium and long-term effects, permanent and temporary effects, positive and negative effects, and secondary, cumulative and synergistic effects” including on issues such as “climatic factors” (Schedule 2, Para 6).

The Claimants contend that (1) the emission of GHGs from the consumption of the extracted oil and gas (“End Use Emissions”) constituted a likely significant effect on the environment, which the Defendants were required to assess, and (2) no such assessment was carried out, whether within the SEA or through the application of the Checkpoint.

The claims are resisted by both Defendants. The SoS maintains that the decisions were lawful on the basis that clear and reasoned judgments were made in respect of the exclusion from the SEA of an assessment of End Use Emissions.

Against that background, the parties will invite the Court to determine whether:

1. The SoS’s decision not to assess the End Use Emissions in the SEA was irrational and/or in breach of the 2004 Regulations;
2. The SoS failed properly to assess the reasonable alternatives to his plan, by failing properly to assess the alternative of not proceeding with further licensing, contrary to the  2004 Regulations;
3. The SoS unlawfully failed to provide reasons for a new licensing round being compatible with the Checkpoint and the UK’s climate objectives and/or whether this is now an academic matter upon which no ruling is required;
4. The SoS’s adoption of the Checkpoint was unlawful because it excluded a requirement to conduct an assessment of End Use Emissions;
5. The SoS relied upon the Checkpoint when deciding to adopt the plan assessed in SEA and to endorse the Licensing Round and, if so, whether was any such reliance was irrational;
6. If the SEA was unlawful, whether the OGA’s decision to proceed with the Licensing Round was, in turn, unlawful;
7. The OGA acted irrationally in relying upon the SoS’s adoption of the Checkpoint when taking its decision to proceed with the Licensing Round.

The Claimants obtained permission to proceed with the claims following an oral hearing before Waksman J on 5 April 2023. The hearing will proceed over two days before Holgate J on 25-26 July 2023.