An economic analysis examining two North Sea oil and gas development proposals has concluded that the long-term costs of climate damage would substantially exceed their projected economic value to the UK.
The study estimates that carbon pollution from the Rosebank and Jackdaw fields would generate economic damage between £119bn and £336bn through 2100, compared with £28.7bn in value identified by Adura, the fossil fuel company seeking development approval. The assessment applies peer-reviewed climate economics research to production forecasts for the fields. Researchers note the damage estimates likely understate actual costs, as they exclude losses from intensified extreme weather events, coastal erosion, and climate-related mortality.
The development proposal has become a focal point of political controversy in the UK. The oil industry and certain energy leaders have advocated for approval, while most centrist and progressive political parties, climate scientists, and environmental organizations have opposed the projects. Prime Minister Andy Burnham faces internal party pressure from Labour MPs opposed to the development. The analysis has been submitted to both the government consultation process and an academic journal.
Proponents of the fields argue they would strengthen energy security and reduce consumer bills, but energy experts counter that oil and gas are internationally traded commodities, making such claims unfounded. The new analysis suggests any economic benefits would be overwhelmed by climate-related economic losses globally. Researchers note that if production exceeds company projections, estimated climate damage could rise to £170bn-£482bn, with even a small portion of these costs occurring in the UK sufficient to eliminate all projected economic gains.
The UK government maintains that North Sea resources remain strategically important, stating that oil and gas will play an ongoing role in the energy system during the transition to clean power. The government’s official climate advisers have previously concluded that achieving net zero targets represents a more cost-effective economic path than continued fossil fuel dependence.
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