Shell is reconsidering its decision to pull out of the project amid reports that developing the Cambo field will not solve the problem of high energy bills.
Proposed development on Shetland’s west coast was suspended in December after the energy company decided to pull out of the scheme, concluding that the economic case for investment was “not strong enough”.
However, oil prices have risen above £76 a barrel, with fears over the future of Russian oil sending prices soaring and calls for improved energy security through increased North Sea oil and gas drilling.
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Sources told the BBC that while Shell’s official position remained unchanged, it did acknowledge that “the economic, political and regulatory environment has changed dramatically” in the three months since Shell announced it was pulling out of the project.
Industry body Offshore Energies UK – formerly British Oil and Gas – has previously said blocking long-planned energy projects such as Cambo would risk putting the UK at the mercy of a global energy shortage.
But Greenpeace warned that the proposed development would not address high bills or improve energy security, and urged the UK government to strongly back renewables, insulation and heat pumps to wean Britain off oil and gas.
Shell’s decision to pull out comes just weeks after the UK hosted the UN’s Cop26 climate summit in Glasgow, where countries pledged to try to limit global warming to 1.5 degrees Celsius to avoid the worst effects of an overheating planet.
If the world is to reach the 1.5C target, no new oil and gas exploration projects should be launched, the International Energy Agency said.
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In November, Scotland’s First Minister Nicola Sturgeon said the Cambo project should not go ahead after months of opposition parties and activists asking the Scottish government to clarify its position on Cambo.
High oil prices are being driven by global markets, and the UK’s increased fossil fuel extraction will not actually have an impact on bills, the advisory committee on climate change said, urging efforts to cut oil and gas demand.
Philip Evans, an oil and gas transition campaigner at Greenpeace UK, said the Cambo project would produce heavy crude for which the UK had very limited refining capacity and would “do nothing to address high bills or enhance energy security”.
He said: “Shell wasn’t interested in them when the project looked bad, but now that they’ve got billions of dollars in wartime price hikes, they’re interested again.
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“Meanwhile, our bills are soaring and offshore workers are stuck in a volatile industry. The UK and North Sea communities deserve better.
“With the Spring Statement and the New Energy Strategy, the government must strongly support the rollout of renewable energy, proper home insulation schemes and heat pumps in the UK, or our energy policy will be disrupted for decades by the whims of the fossil fuel giants .”
Tessa Khan of environmental campaign group Uplift told Good Morning Scotland: “It’s clear that Shell has seen an opportunity in higher oil prices and may be able to profit.
“But the reasons for not supporting Cambo – it won’t lower the UK’s energy bill, it won’t help us meet our domestic energy needs because its oil will be exported to international markets and of course there will be huge climate impacts. There will be.
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“None of these things have changed. So the case against opening Cambo is stronger than ever.”
Friends of the Earth energy campaigner Danny Gross said: “Developing the Cambo field will not help reduce soaring fuel bills.
“As 80% of the oil extracted in the UK is exported, it won’t significantly improve our energy security either.”
“The energy crisis has highlighted our need to reduce our reliance on increasingly expensive gas and oil, which are also disrupting our climate,” he said, calling for cheap homegrown renewable energy and a nationwide insulation scheme.
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Emily Beament is the PA Environmental Correspondent.
