How much oil – and how much profit – remains beneath the waters shaking the British Isles?

Considering the number of lawyers gathered at the Court of Session in Edinburgh this week, that must be a decent number.

Seven advocates gathered in the front row of courtroom one, where environmental campaigners are challenging the government’s approval of the Rosebank and Jackdaw fields.

Behind them, three other rows were also filled with lawyers, typing on their laptops and scribbling in notebooks. Such an army is obviously not cheap.

It is remarkable that they all agree on one fundamental fact: The Rosebank oil field in the Atlantic and the Jackdaw gas development in the North Sea were illegally authorized.

However, lawyers strongly disagree about what, if anything, should be done.

The person who must decide is Andrew Stewart, better known by his judicial title, Lord Ericht, who presides over this judicial review of the British government’s decisions to approve the fields.

The previous Conservative administration and the oil and gas regulator gave the OK to the Jackdaw project in summer 2022, with its owner Shell saying the field would be able to supply gas to 1.4 million homes British.

Rosebank, located west of Shetland and estimated to contain between 300 and 500 million barrels of oilreceived the green light the following fall.

Operated by Norwegian energy giant Equinor and Aberdeen-based Ithaca Energy, it is believed to be the largest untapped field in UK waters and its oil is to be transported by tanker and sold on the international market, with some of the gas going to Shetland. .

Among many other requirements, authorization was granted based on environmental impact statements submitted by companies.

As was common practice at the time, these assessed the climate impact of emissions caused by the oil and gas extraction process, but did not assess the impact of the greenhouse gases that would be released. when the fossil fuels were finally burned, known as downstream emissions.

Consent in hand, field owners rushed to work to prepare for drilling, striking deals with suppliers and hiring staff.

All week the court heard repeated references to the huge sums of money spent on the two projects.

Equinor’s lawyer said it would invest £2.2 billion in Rosebank, providing employment for 4,000 people.

Shell’s lawyer said it would invest £1.1 billion in the Jackdaw gas field in the North Sea, employing “at least 1,000” people between 2023 and 2025.

Production is expected to begin at Jackdaw in 2026 and at Rosebank in 2026/27.

But last June, climate campaigners’ victory in the UK Supreme Court sent shivers down the spines of the three companies and the entire industry.

In the case of Finch v Surrey County Council, which concerned a dispute over the drilling of oil wells near Gatwick Airport in London, the court ruled that an environmental impact assessment must include downstream emissions.

“I simply lost a bet”

On the eve of the judicial review, Sarah Finch, the environmental campaigner after whom the Surrey case is named, told me that “exactly the same thing happened in Rosebank”.

“It was granted permission without an assessment of the impact of burning the oil or gas that would result,” she said, adding: “So a much larger site, but exactly the same argument.”

All three companies involved in the Court of Session accept the Finch decision, meaning that, in hindsight, their licenses were granted illegally.

However, they insist on the fact that they provided all the required environmental information at the time of their application; the industry regulator told them not to assess downstream emissions; and they should not be “punished” for a Supreme Court decision they say they could not have predicted.

Lord Ericht appeared to succinctly sum up their position on Friday, when he suggested that this amounted to asking him to say: “I accept that this decision is unlawful but I give it legal effect.”

Campaign groups Greenpeace and Uplift strongly oppose such an idea.

They disagree that the decision in the Finch case could not have been predicted, with one lawyer suggesting the oil companies had simply lost a bet.

Both groups now want the judge to suspend work on Rosebank and Jackdaw while emissions downstream from the fields are assessed.

Then, they say, Energy Secretary Ed Miliband and the North Sea Transition Government Authority (formerly known as the Oil and Gas Authority), could make a new decision on licensing deposits, armed with a better understanding of their contribution to the exploitation of deposits. climate change.

Even then there may be a problem. Government lawyers, who were also in court, say that in some circumstances they doubt whether Mr Miliband has the legal authority to reverse decisions.

If Miliband did indeed have power, and it came to a head, it is unclear what he would do. In court, the British government’s lawyer was reluctant to comment on the matter.

At times he gave the impression that the ministers really wanted the whole thing to go away.

After all, in campaigning against the Conservatives in this summer’s general election, Labor had carefully crafted a policy that seemed designed to minimize controversy and avoid getting drawn into the Rosebank debate.

It went like this: Labor was determined to tackle climate change by reducing greenhouse gas emissions, but also recognized the importance of the oil and gas industry.

As such, it would not grant any new exploration licenses in UK waters, but it would allow existing projects – including Rosebank and Jackdaw – to continue.

Ministers spoke of domestic energy production as key to reducing bills; contribute to ensuring the country’s energy security; generate taxes; and to help transition from fossil fuels to renewable energy.

Many of these claims are disputed by environmentalists.

Tessa Khan, executive director of Uplift, said 80% of Britain’s oil was exported.

“There is no world in which you could have a robust environmental assessment that takes into account these downstream emissions and decide that these environmental impacts are acceptable,” she told me.

However, in Aberdeen, the heart of the UK’s energy industry, there is great nervousness about the potential impact of the decision in this case and about the wider impact of government policy on the sector.

Just last week, a U.S. oil company said it would end the whole thing. North Sea operations by end of 2029 due to high tax levels.

Now the eyes of climate activists, politicians and oil companies are on Lord Ericht.

Perhaps he will find a compromise, for example by allowing oil companies to carry out preparatory work – provided they do not extract oil or gas – while requiring them to provide the government with information on downstream emissions to allow them to reconsider the decision.

The companies’ lawyers resisted the suggestion that they were in the gambling business, but in such a case they might have no choice but to bet that the policy of pulling the plug would be too painful for Sir Keir Starmer’s government.

On Friday evening, the judge retired to consider his decision, a process that could take several weeks or even months.

Thanking the many lawyers for their “excellent contributions”, he concluded the hearing by saying: “This is a very difficult question and it is a very important question”, adding: “I will give my judgment in due course.”