Andy Burnham's new energy secretary urged to overturn North Sea drilling ban as UK 'trails behind Norway'

The new Energy Secretary must overturn the ban on new North Sea exploration licences, industry bodies say.

Miatta Fahnbulleh has taken Ed Miliband’s old post at the Department for Energy Security and Net Zero, with Mr Miliband promoted to Foreign Secretary.

On her first full day in the job, Ms Fahnbulleh was urged to meet North Sea representatives and to “make clear the new Government backs homegrown energy production over growing reliance on imports”.

Industry leaders hope her appointment will mark a change of course for the Government, which, with Mr Miliband in post, had been accused of accelerating the decline of the North Sea basin.

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But some linked to the sector have pointed to Ms Fahnbulleh’s track record on green issues and fear “we will see more of the same”.

Offshore Energies UK has argued for the windfall tax, which sees operators pay a headline figure of 78 per cent of profits, to be replaced as soon as possible.

This would unlock billions in investment, it says. It wants a ban on new exploration licences, which was included in Labour’s manifesto, to be overturned.

The ban, it says, “leaves the UK trailing behind Norway instead of partnering with it to underpin European energy security”.

It also wants drilling to restart at both Rosebank, Britain’s largest untapped oil field, and Jackdaw, a gas field.

Work at both sites was halted, pending legal challenges on climate grounds. The decision on whether work can go ahead rests with the Energy Secretary.

Under Mr Miliband, who once described Rosebank as “climate vandalism”, work remained halted at both.

OEUK said: “There is now an opportunity for the new Energy Secretary to work with the sector to deliver on Prime Minister Andy Burnham's commitment to reindustrialise Britain by supporting the workers, businesses and communities that underpin the UK's domestic energy industry.”

It says that failing to exploit the North Sea leaves us more reliant on imports, many of which have a higher carbon footprint.

Changing the current regime would bring in billions in investment, it says, on top of boosting tax receipts by more than £13billion and supporting thousands of jobs.

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David Whitehouse, chief executive of Offshore Energies UK said: “All of us here at OEUK congratulate Miatta Fahnbulleh on her appointment as Energy Secretary and look forward to working with her as she shapes UK energy policy to deliver on the Prime Minister’s vision to reindustrialise Britain.

“The UK will still need oil and gas for decades to come. The question is whether we produce as much of that energy as possible here, supporting our own jobs, communities and economy, or become increasingly reliant on imports while exporting investment and economic value overseas.

“We urge our new Energy Secretary to back North Sea production as part of a secure and managed energy transition.

“The Prime Minister has made it clear that communities and industry will be at the heart of his Government. You cannot put communities first if you do not back the industries that sustain them.

“That means backing homegrown energy in all its forms, from North Sea oil and gas to offshore wind, unlocking investment and giving workers and businesses the confidence to build Britain's energy future here at home.”

The Aberdeen & Grampian Chamber of Commerce, which sits in the heart of North Sea oil country, said “there is huge remaining potential in the North Sea”, but only with a change of approach.

It pointed out that Ms Fahnbulleh was “a longstanding advocate for greater action on climate change”.

Before entering Parliament in 2024, she was the chief executive of the New Economics Foundation, where the AGCC said she “advocated for a rapid net zero transition”.

The AGCC said: “[Andy Burnham’s] team has been briefing that the new Prime Minister will be more favourable towards North Sea oil and gas, but his pick for Energy Secretary suggests we will see more of the same.”

Russell Borthwick, Chief Executive of the AGCC, said: “We look forward to working with the new Prime Minister and his government to drive growth, create jobs and unleash greater productivity – enabling the North-east of Scotland to be a powerhouse region driving forward the UK economy.

“When it comes to our energy sector, there is huge remaining potential in the North Sea.

“But this future is only achievable with a fresh approach - clearing the regulatory logjam by consenting Jackdaw and Rosebank, replacing the windfall tax with the new Oil and Gas Revenue Levy and taking a more pragmatic approach on issuing new licences.

“On renewables and new energy, we need to ensure that we’re managing the transition carefully – consenting more projects, building out transmission infrastructure with pace and ensuring that new technologies are supported so Britain can lead a global revolution, rather than playing catch-up.

“From high-value manufacturing, to supply chain services, to engineering excellence, our region can support that exciting new chapter – but only if we’re not held back by overregulation and punitive taxation.”

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