(Sharecast News) – The government has approved the development of Rosebank, the UK’s largest untapped oil field, sending shares in its operators higher.
The development of the field, 130km north west of Shetland in the North Sea, is opposed by environmentalists.
Last month a cross-party group of MPs and peers wrote to then energy secretary Grant Shapps, urging him to block the move. They claimed Rosebank could produce 200m tonnes of carbon dioxide, with taxpayers shouldering much of the development costs.
But announcing the government’s decision on Wednesday, new energy secretary Claire Coutinho said it “makes sense” to use oil and gas from North Sea fields such as Rosebank.
She continued: “We will continue to back the UK’s oil and gas industry to underpin our energy security, grow our economy and help us deliver the transition to cheaper, cleaner energy.”
London-listed Ithaca Energy – which owns a 20% working interest in the field – said it and majority operator Equinor, the Oslo-based energy firm, would initially invest $3.8bn in the development.
The project is expected to create around 1,600 jobs during the construction phase, and 450 positions long term.
Recoverable resources are estimated at around 300m barrels of oil from phase 1 and phase 2, with phase 1 targeting 245m barrels of oil.
Ithaca said that in total, the project is expected to lead to around £8.1bn of total direct investment.
Gilad Myerson, executive chair, said: “We are now poised to embark on a journey that will not only provide critically important domestic energy but also ignite substantial economic impact.
“The Rosebank project will create thousands of jobs and contribute significantly to securing the UK’s energy needs for many years to come.”
However, Caroline Lucas, co-leader of the Green party, called the decision “the greatest act of environmental vandalism in my lifetime”.
She continued: “This is morally obscene. It won’t improve energy security or lower bills, but it will shatter our climate commitments and demolish global leadership.”
As at 0930 BST, shares in Ithaca were trading 8% higher at 177p, while Norway-listed Equinor was ahead 1%.
Production is expected to begin in 2026/27.
