A landmark legal challenge to UK onshore oil and gas production was heard by the country’s highest court in 2023.

In June, five Supreme Court justices considered the case brought by campaigner, Sarah Finch. She argued that the climate impact of burning fossil fuels must be assessed before any decision could be made on production plans.

The case, which had previously gone to the High Court and Court of Appeal, focussed on Surrey County Council’s approval of oil production at the UK Oil and Gas (UKOG) site at Horse Hill, near Horley.

But the outcome, which is still awaited, could have major implications for all new fossil fuel projects in the UK, including the controversial new coal mine in Cumbria.

The significance of this case was revealed when the UK’s newest environmental watchdog, the Office of Environmental Protection, intervened, along with the levelling up secretary and the company behind the Cumbrian coal mine.

Ms Finch said Surrey County Council acted unlawfully when it failed to consider greenhouse gas emissions resulting from the use of Horse Hill oil. The council said it needed to consider only the climate impact of the production operation.

The arguments are already influencing other legal challenges. DrillOrDrop will report in detail on the Supreme Court ruling when it is published.

Oil and gas in protected areas

The impact of onshore oil and gas operations on protected areas was the focus of three more legal challenges in 2023, each supported by small local campaign groups.

SOS Biscathorpe is seeking to overturn a ruling by a planning inspector, who granted permission for long-term oil production in the Lincolnshire Wolds area of outstanding natural beauty (AONB).

The campaigners, some of who have campaigned against oil operations at Biscathorpe since 2014, were shocked and angered by the inspector’s decision, published in November. He accepted that the production scheme would harm the AONB and contravened some local planning policies. He also acknowledged that the volume of produced oil may be small and could be exported. But he said the national need for oil justified planning permission.

SOS Biscathorpe submitted papers to the High Court in December. The site operator, Egdon Resources, and Lincolnshire County Council must respond by early January.

In West Sussex, Balcombe villagers are applying to challenge permission for testing an oil well in the High Weald AONB.

The Balcombe site, now operated by Angus Energy, has been controversial since 2013, when daily protests against a new oil well made national headlines.

The county council refused planning permission for the well test in 2021. Angus Energy successfully appealed. In October, Frack Free Balcombe Residents’ Association failed to overturn that decision at the High Court and is now seeking a hearing at the Court of Appeal.

Thirty miles away, on the edge of the Surrey Hills AONB, another campaign group is challenging oil drilling near the village of Dunsfold.

In this case, Surrey County Council twice refused planning permission. The site operator, UKOG, successfully appealed. Protect Dunsfold and Waverley Borough Council failed to overturn that decision in the High Court and are now applying for a hearing at the Court of Appeal.  

More legal challenges

• The government is facing a second court challenge over its net zero strategy. Friends of the Earth, ClientEarth and the Good Law Project argue that the strategy is unlawful. In 2022, they successfully forced the government to revise its original strategy.
• Two people are bringing a legal challenge to the government’s climate change national adaptation programme. They argue it is inadequate and breaches the Climate Change Act.
• The broadcaster, Chris Packham, outlined plans to challenge Rishi Sunak over changes to government commitments on phasing out new fossil fuel cars and boilers (See COP28 and climate change).
• Uplift and Greenpeace were granted permission to bring a High Court challenge to the issue of new oil and gas licences in the North Sea (See COP28 and climate change).
• In a separate challenge, the two organisations announced they were seeking to overturn the approval of development of Rosebank, described as the UK’s largest untapped North Sea oil field.
• The hearing in a legal challenge by Friends of the Earth and South Lakes Action on Climate Change against the Cumbrian coal mine was delayed until after the ruling on Sarah Finch’s Horse Hill case.
• Ineos was ordered to pay costs in a legal challenge against the company’s protest injunction.
• Egdon Resources withdrew its appeal against refusal of planning permission for drilling at North Kelsey, a week before a public hearing. A new planning application is expected.
• The onshore shale gas industry failed to bring a case for damages over the reinstatement of  fracking moratorium in England in October 2022.
• The Supreme Court refused an application by Friends of the Earth to challenge UK government funding of a $1.15bn gas project in Mozambique. 

Fracking

The UK onshore shale gas industry appeared to be in retreat in 2023, after the momentous but brief lifting of the moratorium on fracking in England the year before. (See 2022 Review of the Year)

In August, the industry regulator, the North Sea Transition Authority (NSTA), ordered Cuadrilla to plug and abandon its fracked wells at Preston New Road in Lancashire. The company was given until 30 December 2024 to complete the work. Operations at the site in 2019 caused the strongest fracking-induced earthquake onshore in the UK.

In June, Lancashire County Council gave Cuadrilla until June 2025 to decommission the Preston New Road wells and return the site to farmland. The council later revealed that Cuadrilla aimed to plug and abandon the wells by 31 March 2024, subject to the availability of a rig.

Also in 2023, Cuadrilla’s owner, the Australian mining group, impaired the value of its UK shale gas assets by more $157m and relinquished three shale gas licences in Yorkshire (PEDL287, PEDL290 and PEDL342). It gave up operation of PEDL347, also in Yorkshire, in an agreement with Egdon Resources and York Energy.

IGas, later renamed Star Energy, cut the value of its shale gas assets and decided not to sue the government over reinstating the fracking moratorium.

In the autumn, work began to decommission Star Energy’s remaining shale gas well, at Misson in Nottinghamshire. A rig left the site in November.

Two potential shale gas sites, owned by IGas near Chester, were put up for sale. The NSTA no longer lists PEDL190, the licence covering the area.

Major oil incident

A major incident was declared in Poole Harbour, in Dorset, in March after a pipeline leak from Wytch Farm, the UK’s biggest onshore oil field.

About 200 barrels of oil and reservoir fluid (about 11,000 gallons) are estimated to have leaked into the water. People were advised to stay away from beaches and avoid gathering shellfish.

The environment minister, Lord Benyon, described it has a “significant spill” and said the site operator, Perenco, would be held responsible for any damage.

Seven months later, in November, the Environment Agency said it was still working to understand what happened to cause the spill. Floating barriers were likely to remain in place “for some time” and Perenco would be required to carry out “ongoing monitoring and reporting”, the EA said.

COP28 and climate change

Representatives of almost 200 countries gathered at the UN COP28 conference in Dubai to agree the next global steps to tackling climate change.

King Charles opened the event with a warning that a “vast, frightening experiment” on the natural world risked triggering feedback loops in the climate system which would cause irreversible disaster.

The COP president, Sultan Al Jaber, also head of the Abu Dhabi National Oil Company, said there was “no science” behind demands to phase out fossil fuels.

The final agreement included the first ever move to transition away from fossil fuels. But small island states complained the deal had been rushed through without them. It also left out earlier stronger language to phase out fossil fuels, pushed for by the US, UK, and EU.

COP28 had the biggest carbon footprint of any climate summit so far. Analysis also suggested the conference admitted a record number of people affiliated with oil and gas industries, at least 2,456.

While preparations were underway for COP28, global temperature records were broken in July and September. EU scientists warned that 2023 would be warmest year on record. The global mean temperature for the first 11 months hit the highest level on record, 1.46C above the 1850-1900 average.

Despite this, Rishi Sunak promised to “max out” North Sea oil and gas reserves and grant hundreds of new licences in the North Sea (July). He later delayed plans to phase out fossil fuel cars and boilers (September). Both announcements were criticised by environmentalists, climate campaigners and political opponents. Analysis suggested that proposed new North Sea fields would produce enough gas to satisfy UK needs for, at most, three weeks a year.

In October, the NSTA announced the award of the first 27 licences in the 33^rd oil and gas licensing round. The regulator said it had received 115 applications, the highest number since the 29^th round in 2016-17.

A new Offshore Petroleum Licensing Bill, introduced to Parliament in November, would require new North Sea oil and gas licences to be offered annually. It also said licensing rounds would be subject to “stringent new emissions” tests.

Also in 2023, the NSTA, whose single shareholder is the energy and net zero secretary, announced the approval of the Rosebank oil field, 80 miles off Shetland. It was described as the biggest untapped UK offshore oil field, estimated to contain 500 million barrels of oil. Opponents said that decision was heading for the courts (see More Challenges).

The UK government’s climate advisor, the Climate Change Committee (CCC) warned ministers that the expansion of fossil fuel production was “not in line” with the UK’s goal to reach net zero carbon emissions by 2050. The CCC also urged ministers to kick the fossil fuel habit to avoid the worst climate impacts. It said the prime minister’s roll back on fossil fuel cars and boilers would make emissions targets harder to reach. The government has refused to disclose the impact of this policy change on carbon emissions.

Despite the warnings, the government also rejected calls to bring forward a ban on flaring on oil and gas sites from Chris Skidmore, the reviewer of the net zero strategy, the Environmental Audit Committee and 25 non-governmental organisations.

Also this year, new analysis revealed that UK council pension funds had invested £16bn in fossil fuels, of which more than £8 billion were in new oil and gas projects. The British Museum announced a 10-year partnership with BP, worth £50m, to help fund one of the biggest redevelopments in its history.  More than 40 UK universities were also reported to have accepted £40m+ in fossil fuel funding since 2022

Protest

New government legislation outlawing certain types of protest came into force in 2023.

The Public Order Act increased police powers to respond to protests and put restrictions in place.

These included new and expanded use of stop and search, as well as orders that could ban people from participating in protests and control their movements. The act also included new offences that criminalised some forms of protest, such as locking-on and being equipped to lock-on, causing serious disruption by tunnelling, obstructing major transport works and interfering with key national infrastructure.

The government had cited anti-fossil fuel protests by groups, such as Just Stop Oil and Insulate Britain, to justify the legislation.

Protests continued, including a weekend of action in September calling for the phase out of oil and gas operations.

A month later, the Metropolitan Police used the new powers for the first time to arrest climate protesters. The Guardian reported more than 60 climate activists were arrested during a slow march outside parliament.

The Swedish climate campaigner, Greta Thunberg, was also charged in October for allegedly breaching a Section 14 order outside an oil and gas conference in London. She later pleaded not guilty and is awaiting a trial.

Gail Bradbrook, the co-founder of Extinction Rebellion, was found guilty of breaking a window at the Department of Transport. The judge told jurors she had no defence in law and that her motivation was irrelevant. She was later given a 15-month suspended prison sentence.

In November, Just Stop Oil reported that 612 of its supporters had been arrested in four weeks. In one march in central London, the organisation said 14 people were arrested within 30 seconds of stepping off the pavement.

The UN’s rapporteur for climate change and human rights warned that long jail sentences given to two Just Stop Oil protesters for scaling the M25 bridge over the Thames was a potential breach of international law.

Onshore production

Onshore UK production was boosted in 2023 by output from the newest oil field at Wressle, in North Lincolnshire, and resumed gas extraction from Saltfleetby, in Lincolnshire.

But about 80% of onshore oil production continued to come from Wytch Farm. And DrillOrDrop analysis revealed that almost a fifth of UK onshore production fields extracted no oil or gas in the past five years.

In August, the Wressle operator, Egdon Resources, reported that the well was also producing water. An artificial lift on the well aimed to increase pressure in the reservoir and improve oil flow rates. The Environment Agency has also raised the limit on the flow rate. Official data released in the New Year will reveal the impact of the operation on production. Egdon has also confirmed plans for two new production wells at Wressle, one of which will target gas. A planning application is expected in early 2024.

At Saltfleetby, Angus Energy completed a sidetrack well in March. The company later said well cleaning had taken longer than expected because of incomplete acidisation of mud additives during drilling. A permanent flowline was commissioned in November.

A partner in the mothballed Avington oil site in the South Downs National Park in Hampshire revealed that production was due to resume. The site operator, Star Energy, has given no details of the plans but local people have opposed the move.

Also in 2023, Star Energy secured planning permission for a new oil production site at Glentworth in Lincolnshire. Egdon Resources revealed that it wanted to expand a suspended oil site at Waddock Cross in Dorset and restart production.

At West Newton, in East Yorkshire, plans for a horizontal production well were postponed until autumn 2023 and then 2024. The operator, Rathlin Energy, said it was seeking extra funding to meet its drilling and testing obligations.

At Horse Hill, UKOG announced in February it had installed three groundwater monitoring boreholes as part of plans for water reinjection at the site. The Horse Hill-1 well, once described as the Gatwick Gusher and said to be nationally significant, saw its value downgraded for the third time. UKOG impaired the asset to £80,000. Since 2020, the well has been impaired by more than £13m.

Two new production wells at Horse Hill that were put on hold in 2022 were also not drilled this year. UKOG announced an initial farm-in agreement  with the Texas-focused PennPetro Energy. The deal, later extended to June 2024, would see PennPetro pay all the costs of seismic surveying and a new production well at the site. Since May, PennPetro has been chaired by David Lenigas, formerly executive chairman of UKOG.

Renewables

A controversial site proposed for fracking became a pioneer of renewable energy in 2023. Third Energy announced its KM8 well at Kirby Misperton in North Yorkshire would be a pilot test site for geothermal energy. It is the first of its kind to move from onshore gas to clean energy production.

IGas changed its name to Star Energy in June to reflect its interest in renewable energy. It became the preferred contractor to deliver geothermal heat schemes for hospital trusts in Salisbury and Greater Manchester. The company was also granted two geothermal licences in Croatia and appointed two new directors with renewables experience. Despite this, renewables remain a small part of Star Energy’s business. The company operates 26 onshore UK producing oil fields and one gas field. Plans were refused in 2023 for fossil grey hydrogen production at Albury, in Surrey. This follows a previous refusal in 2022 at another Star Energy site in Surrey at Bletchingley.

Company news

In March, Egdon Resources acquired Aurora Production Limited, a private company which held 18.75% of the Waddock Cross licence PL090 and 8.33% of the Avington field, PEDL070. In May, Egdon announced it had agreed to a £26.6m takeover by Petrichor Partners, a subsidiary of the Dallas-based Heyco Energy Group. Egdon’s ultimate parent company is now Explorers Petroleum Corp, controlled by George Yates.

In November, shareholders challenged directors of Reabold Resources, a key player in the West Newton oil and gas development in East Yorkshire, and in Europa Oil & Gas. A meeting will discuss changes to the Reabold board on 10 January 2024.

Ineos, which holds the largest number of UK shale gas licences, bought the US shale assets of Chesapeake Energy for $1.4 billion. Also in 2023, Ineos plans for the Project One ethane cracker in Antwerp, were blocked by a Belgian court.

People

At Angus Energy, George Lucan stepped down as chair and Andrew Hollis left his role as technical director. Europa’s chief executive, Simon Oddie, retired and was replaced by William Holland, the company’s chief financial officer.

Before its name change, IGas appointed Chris Hopkinson as chief executive and Philip Jackson, formerly of Kerogen Capital, as non-executive chairman.

In the most recent government reshuffles, Claire Coutinho became energy and net zero secretary and Steve Barclay environment secretary. Ms Coutinho is the 10^th secretary of state for energy in 13 years of Conservative rule.

DeSmog reported that Susan Hall, the Conservative candidate for London Mayor, had previously backed the reintroduction of fracking and opposed key climate policies.

The deaths were reported of anti-fracking campaigners Bob Dennett, Jon O’Houston and Michael Farman.