Greenpeace tries to obstruct oil licences

Greenpeace is going to court with the aim of disrupting allocation of licences for offshore exploration drilling

Last week witnessed the latest attempt by the environmental group Greenpeace to disrupt efforts to recover oil from the deep waters to the west of the Shetland Islands.

Greenpeace went to the High Court to seek a judicial review of the 17th Offshore Round, in which 30 oil companies were awarded licences to carry out exploration drilling in the region. If its application is successful, the full hearing is expected to start in the week beginning 17 November.

The action will have no impact on the licences awarded in previous rounds, which cover the two current developments in the area – BP’s Foinaven and Schiehallion projects – and the other existing discoveries.

Greenpeace sought the review on the grounds that the Government had granted the licences illegally, because it had failed to consider its duty to protect the rare Lophelia pertusa coral in the region, in line with the European Habitats Directive. Lying at a depth of around 300m, the coral is thought to support more than 800 species of marine life.

‘There are big environmental issues at stake here,’ said Peter Melchett, executive director of Greenpeace. ‘The public should be able to trust the Government to carry out proper environmental assessments before oil companies are allowed to start work, risking damage to sensitive marine habitats.’

The oil companies observed that the environmental group would not know of the existence of Lophelia pertusa in the region without their sea-bed surveys – the latest being an extensive 3D sweep of more than 20,000 square kilometres last year. ‘The only information they have is information provided by the oil companies,’ said a company source.

It is also unclear how much of the coral exists there. According to Brian Bett at the Southampton Oceanography Centre, which carried out the 1996 survey, only one Lophelia colony, measuring about 20cm in diameter, was found in the 60,000m2 of ocean that was photographed during the study.

The Government and the UK Offshore Operators’ Association, which represents the oil companies, argued in court that the challenge should be dismissed because it had been brought too late – they said the challenge should have been made when the licensing regulations were introduced in 1994. They also argued that the regulations did comply with the European requirements because the directive requires habitats to be nominated – which was not yet the case west of the Shetlands.

Greenpeace admits that the application for a judicial review is a tactical move in its wider campaign to halt all future oil exploration west of the Shetlands, and indeed elsewhere. The move came barely a month after legal action forced the organisation to call off a five-day occupation of the drilling rig, which was on its way to carry out appraisal work on BP’s Foinaven field in the region.

Melchett spelled out the organisation’s objective ahead of the High Court proceedings: ‘Greenpeace opposes further oil exploration on the grounds that fossil fuels are damaging the climate.’

Heinz Rothermund, managing director of Shell UK Exploration and Production, addressed this argument at a conference on the future of the UK oil and gas industry in London last week.

Rothermund said the two principal contentions were that the UK’s future energy requirements could be met with oil and gas from elsewhere in the world and increased use of alternative non-fossil fuels.

He conceded it would be possible to import the necessary quantities of oil and gas but said the economic and social drawbacks would ‘outweigh the – debatable – environmental benefits’.

Rothermund said such a policy would throw away the prospect of the UK offshore supplies industry becoming a big export earner, just as the pan-industry body Crine was predicting that British suppliers and contractors could increase their share of the world market from 1% to 5% over the next five years.

Along with this potential export coup, he said the wider benefits that oil and gas production and its associated activities bring to the UK would be lost. ‘To put it at its simplest, every £1 used to pay for imports of oil and gas would be £1 not available for education and health services.’

Rothermund added that there was an ethical consideration if the UK expected other parts of the world to produce fuels that it chose not to produce itself. ‘The concept is at best double-think, and at worst pure selfishness.’

On the replacement of oil and gas with renewable forms of energy, Rothermund said this offered only a partial solution – the Government had set a target of 10% of national requirements by 2010.

He also pointed to an unpublished report by the European Commission, which suggested it should be possible to reduce the unit cost of solar power from 64p/kWh to 13p/kWh – compared with the current price of 2.4p/kWh for fossil-fired generation. ‘Can you think of a householder who would welcome, or even be able to afford, a four to sixfold increase in domestic electricity bills?’ he asked.

Point of View, page 12