Introduction
Environmental campaign groups such as Greenpeace and Uplift are increasingly using court proceedings to seek to advance their arguments, often by means of judicial review applications challenging the approach taken by government or regulators in considering environmental issues in licensing or approval processes.
In a high profile example in the oil and gas industry, Greenpeace and Uplift have been given permission to bring judicial review proceedings in connection with the decision to commence the 33rd oil and gas licensing round in October 2022 – the first licensing round since 2019. The issues raised by these challenges could have broader implications for similar decisions in other sectors in considering how environmental factors should be taken into account and we can expect that the substantive stages of these proceedings will be closely watched.
Background
In October 2022, the North Sea Transition Authority (the “NSTA”) launched the 33rd oil and gas licensing round and announced in January 2023, that it received 115 bids across 258 blocks/part-blocks, from a total of 76 companies. The NSTA is currently still considering the bids and it is expected that the first licences will be awarded in 2023.
Following the launch of the licensing round, a coalition of campaign groups threatened legal challenges in a bid to stop the award of new North Sea oil and gas licences, initially writing to the Business Secretary setting out why they considered the launch of the offshore licensing round to be unlawful and seeking the decision to be reversed. In broad terms, their objections related to whether the decision to proceed with the licensing round properly took into account the environmental effects of continued oil and gas production and questioned how the decision to proceed with the licensing round met the newly introduced climate compatibility checkpoint. The climate compatibility checkpoint was introduced prior to the 33rd licensing round and is intended to ensure that any new licensing round is offered only where that is compatible with the UK Government’s climate change objectives, including to achieve net zero emissions by 2050 (further details on the climate change checkpoint design can be found here).
Subsequently Greenpeace and Uplift each filed an application at the High Court for judicial review against the Government’s decision to launch the new oil and gas licensing round.
Judicial Review
The claims by Greenpeace and Uplift were heard together before Mr Justice Waksman on 25 April 2023 and permission was granted to proceed with the judicial review applications.
The claimants seek to challenge the 33rd licensing round on the basis that the Government did not take into account:
- the environmental effects of consuming the oil and gas to be extracted in the new licensing round, and wrongly failed to take into account the advice of the Climate Change Committee; and
- failed to provide any explanation as to why the licensing round was considered to meet the climate compatibility checkpoint.
Additionally, the decision to adopt the climate compatibility checkpoint itself is challenged on the basis that it wrongly excluded two tests which it is claimed ought to have been included: (i) a requirement to consider downstream emissions; and (ii) consideration of the “global production gap”.
The claim will now proceed to a full hearing. The precise process will depend on a number of factors but may take some time - given the importance of the issues raised, it may be that other interested parties seek to be included in the process. At the full hearing, the court will either allow or reject the judicial review claim. If the claim is successful, the usual result is that the decision is “quashed” and must be taken again – this time following the correct procedure and applying the appropriate criteria.
Comment
It is clear that campaign groups are increasingly taking formal steps through court proceedings to challenge fossil fuel industries. Although many such attempts in the UK have so far been unsuccessful (and few have even been given permission to proceed in the context of the offshore oil and gas industry), there have been a few exceptions where permission has been granted. A number of challenges across various industries have raised similar issues pertaining to downstream emissions and how those should be taken into account at the approval or consenting stage. Significantly, the case of Finch is currently before the Supreme Court and concerns a judicial review of the grant of planning permission for new oil wells on a site in Surrey. The Supreme Court will consider whether Surrey County Council acted lawfully by not requiring the development’s environmental impact assessment to assess the impact of greenhouse gas emissions resulting from the future combustion of oil produced by new oil wells (further details on the lower courts’ decisions are set out in our annual review of developments in English oil and gas law).
Although the particular challenges that have now been given permission to proceed in connection with the 33rd licensing round relate specifically to the offshore oil and gas industry licensing regime, it seems likely they will be watched by a broader section of industry in light of the potentially broader relevance of the issues raised.
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