A UK energy company is bringing two offshore fields onstream to produce 500 million barrels of oil.
ADVERTISEMENTUK energy company EnQuest is planning to start drilling for oil in the North Sea in what it expects to be the highest "yield" of oil there over the past 20 years.
The group was recently awarded a licence to drill in the North Sea in a controversial decision that ignored warnings from scientists and the United Nations urging countries to stop developing new fossil fuel resources because of climate change.
The Equinor Rosebank North Sea oil field was last September given the go-ahead to drill for the 350 million expected barrels of oil is expected. EnQuest Heather, a subsidiary of EnQuest, was given in February a licence which was among 24 new ones given the go-ahead.
EnQuest's two new sites, Bressay and Bentley, are expected to produce between 500 and 600 million barrels of oil in total.
Is the UK at risk of a shortage of energy supplies?
In an era of net zero crackdown, energy companies are under pressure to cut back on oil and gas production and boost investment in renewables.
But some, like CEO of Shell Wael Sawan said recently that the world still "desperately needs oil and gas" because the development of renewable energy projects is lagging behind.
The UK Department for Energy Security and Net Zero highlighted that: "We'll still need oil and gas for decades to come, even when we reach net zero in 2050."
The International Energy Agency put it in a different way, saying that oil demand needs to collapse by three-fourths over the next three decades to reach net zero by 2050.
The UK government argues that the country "still relies on oil and gas for most of its energy needs", and that "new licensing opportunities will protect British jobs and bolster energy security, reducing the UK's reliance on imports from hostile foreign regimes such as Russia."
A spokesman for Offshore Energies UK, the industry trade body said told the Daily Telegraph: "Continued investment in UK energy opportunities, including oil projects, is necessary to ensure UK security of energy supply, support hundreds of thousands of jobs and contribute to the UK economy."
The newspaper also noted that almost all the oil found is expected to be exported because neither of the fields, nor the neighbouring Kraken field, are linked to a pipeline. That means the oil needs to be collected by ship and taken to refineries, which then offer to buy it.
The UK government states that new oil and gas licensing will help secure 200,000 jobs and billions in tax receipts and says the country needs to be pragmatic in its transition to net zero.
Secretary of State for Energy Security and Net Zero Claire Coutinho, said "The UK has cut its emissions faster than any of its peers. But as the independent Climate Change Committee acknowledges, we will need oil and gas even as we reach net zero in 2050."
As far as taxes and the oil companies are concerned, the BBC reports that companies are offered big tax benefits if they invest in oil and gas extraction. For every £100 they invest they can claim back £91.40 in tax relief. If they spend on decarbonising, they can claim tax benefits.
The latter could be the case with EnQuest. Craig Baxter, head of investor relations at EnQuest told the Telegraph about how gas extracted from one of the new fields could be used to power the currently working Kraken field nearby, thereby replacing diesel fuels. "This would significantly reduce Kraken's emissions," he said.
