Cabinet split emerges over approving Rosebank oil field – Daily Business

Miatta Fanbulleh has long opposed Rosebank

A split has emerged in Andy Burnham’s cabinet over approving the Rosebank oil field west of Shetland, with the Prime Minister under pressure to take sides.

Chancellor John Healey is said to want production to go ahead, knowing that it satisfies the government’s desire to protect and create jobs produce revenue for the Treasury.

However, the Energy Secretary Miatta Fahnbulleh has been a long-standing opponent of the field and is expected to reject the application on grounds that it will produce seven times more emissions than the Jackdaw gas field which she approved last week.

With the Business Secretary Jonathan Reynolds supporting the Chancellor and Ed Miliband, the Foreign Secretary backing his successor at the energy department, battle lines have now been set.

Mr Healey is said to have explained his view during a visit to Aberdeen last week to mark the approval of Jackdaw, during which he announced an energy wealth fund.

Ms Fahnbulleh told The Guardian last week: “One is a gasfield that caters for the domestic market, while the other is an oilfield that is mainly for export.

“It is right that we judge each application in its own right, and it is absolutely critical that the decision is consistent with our climate obligations, our carbon budgets and the end destination we need to get to with the energy transition.”

Jackdaw, off the east coast, will begin supplying gas within weeks and could account for 6% of North Sea gas production when fully operational, although it will directly create only 27 jobs.

A minister told The Mail on Sunday that Mr Burnham will back Rosebank. “Both Andy and John have decided Rosebank needs to go ahead,” the minister said. “The economic and energy security case is so strong, and the Energy Wealth Fund will help mitigate concerns around the environment.

“It’s the only sensible decision.”

Sharon Graham, head of Unite, said in March that blocking oil and gas production in the North Sea “is simply an act of monumental political self-harm. Domestic gas from Jackdaw and oil from Rosebank are essential for jobs and for energy security.”

Following the approval of Jackdaw, Gary Smith, head of the GMB union, said: “This positive direction of travel must continue at pace. GMB will continue to press for further, essential measures that increase our domestic energy capacity, such as granting permission for Rosebank.”

Daily Business comment: If the Prime Minister is in favour of Rosebank then the question must be asked as to why he appointed Miatta Fanbulleh as Energy Secretary, when she was known to oppose it and had spoken publicly about her opposition.

There can be no further delay on this issue and there is a broader need for the government to set out a clear long-term strategy for the North Sea – for 30 or 50 years – that gives the oil & gas industry and investors a clear path forward.

This must be based on the science, but also on energy security and the requirements of the whole economy.

The emergence of a split in Cabinet should also show that decisions of this magnitude should not rest with one individual.

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