Multinational oil and gas company Shell withdraws from the Cambo oil project in the North Sea after pressure from environmental campaign to stop new oil and gas development on UK soil. 

What is Happening? 

Oil and gas giant Royal Dutch Shell has withdrawn from the controversial oil project in the UK’s North Sea that many environmental groups have avidly campaigned against. 

“After comprehensive screening of the proposed Cambo development, we have concluded the economic case for investment in this project is not strong enough at this time, as well as having the potential for delays,” a Shell spokesperson said on Thursday in a statement.

Operated by Siccar Point Energy Ltd and co-owned by Shell, the Cambo oilfield applied in June 2021 for regulatory approval. But the UK government, which recently hosted the COP26 UN climate summit, has faced increasing pressure from environmental groups that the oil project was inconsistent with the country’s net zero carbon emission target by 2050. The climate activists are also pushing for the UK to stop developing any new oil and gas reserves. 

The oilfield in the North Sea is one of the UK’s biggest potential oil and gas projects, and is said to deliver the equivalent of 170 million barrels of crude oil as well as 53.5 billion cubic feet of gas over 25 years. Shell argues that the project could help reduce the country’s dependence on foreign oil and gas imports, which could also have higher carbon emissions. 

“Let me be very clear, as long as the UK still needs oil and gas in its consumption for its society, it’s better to produce it in its own backyard,” the Shell chief said earlier this year.

Shell’s decision to pull out the project is considered a win for environmentalists and climate activists. Tessa Khan, director of advocacy group Uplift and one of the coordinators of the Stop Cambo campaign said that the withdrawal is a “a message to the UK government that there is no case for new oil and gas” while Greenpeace campaigner Philip Evans said in a statement that the new development has been “deathblow for Cambo”, adding “with yet another key player turning its back on the scheme, the government is cutting an increasingly lonely figure with their continued support for the oil field.”

However, Siccar has no plans to abandon the Cambo project and said in a separate statement that it would continue to engage with the UK government and stakeholders on future development of the field.

“Cambo remains critical to the UK’s energy security and economy,” said Siccar CEO Jonathan Roger. “Whilst we are disappointed at Shell’s change of position, we remain confident about the qualities of a project that will not only create over 1,000 direct jobs as well as thousands more in the supply chain, but also help ease the UK’s transition to a low-carbon future.”

Despite celebration surrounding Shell’s withdrawal from the UK oil project, the company was given approval by a court the following day to start seismic survey offshore the East Coast in South Africa, which is also a known breeding ground for migrating humpback whales in the area. 

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Featured image: © Richard Dixon/Friends of the Earth Scotland