Developing the Cambo oil field is a “huge opportunity” for the UK in terms of energy security and jobs, an energy boss said after his firm became the majority stakeholder for the controversial project.
Alan Bruce, the chief executive of Ithaca Energy, spoke out after a “transformational deal” saw the company acquire Siccar Point Energy.
Siccar Point Energy, together with Shell, had paused plans to develop the Cambo oil field, off the west coast of Shetland.
Mr Bruce, however, said the development of Cambo and the Rosebank field, also west of Shetland, presented “a huge opportunity to not only help secure the UK’s energy future for at least another quarter of a century, but also to create thousands of direct and indirect jobs in the process”.
He said: “We are excited about the future for the enlarged Ithaca, the role we will play in the UK’s energy supply, and look forward to welcoming our new colleagues from Siccar Point.”
Ithaca’s acquisition of Siccar Point Energy comes just over a week after UK authorities granted an extension to the licence for the Cambo field.
However, the project does not yet have the final approval needed for drilling to start.
In December, Shell, which has 30% equity in the proposed development, said it had concluded the economic case for investment in Cambo was “not strong enough”.
The company stressed last month that there was “no change to our position”.
The Scottish Government has already made clear its opposition to Cambo going ahead, with First Minister Nicola Sturgeon saying in November: “I don’t think that Cambo should get the green light.”
Environmental campaigners are also fiercely opposed to the project.
Ithaca Energy, however, described the Cambo and Rosebank fields as “two of the largest undeveloped and most strategically important discoveries in the UK North Sea”.
It stated: “Cambo and Rosebank represent an opportunity for Ithaca to develop fields that will contribute significantly to the UK’s energy security.
“The Cambo field on its own is anticipated to deliver up to 170 million barrels of oil equivalent during its 25-year operational life, materially helping to reduce the need for the import of more carbon intensive alternatives and increasing the UK’s energy independence through the energy transition.”
Speaking about the acquisition of Siccar Point Energy, Mr Bruce said: “This is a transformational deal for the company which cements Ithaca’s position as a leading independent E&P (expoloration and production) operator in the North Sea.
“The acquisition doubles our recoverable resources and means that we now have interests in a significant portion of the largest UKCS (UK Continental Shelf) fields.
“This includes interests in two of the UK’s most strategically important and near-term developments which will enable us to play an increasing role in securing domestic energy supply for the UK.”
Jonathan Roger, chief executive of Siccar Point Energy, said: “Combining our business with Ithaca Energy is a natural step to take the portfolio through the next stage of organic growth.
“Ithaca is extremely well placed, given its material production base, to pick up the baton and unlock the significant growth opportunities in the Siccar Point portfolio.
“This will ensure the UK continues to deliver reliable UK oil and gas production for powering homes and businesses and manufacturing essential products and maintaining energy security during the planned energy transition.”
Cambo's owner might have changed but the facts have not.
— Friends of the Earth Scotland 🌎 (@FoEScot) April 8, 2022
However, Friends of the Earth Scotland’s climate campaigner Caroline Rance said: “It doesn’t matter which profiteering fossil fuel company has their name on the Cambo licence, it doesn’t change the facts about this doomed oil field.
“Exploiting Cambo will do nothing for soaring energy bills but it will further risk our collective safety by worsening climate change.”
UK energy minister Greg Hands said the “change of ownership of Cambo, or part of Cambo, is a commercial decision for those companies”.
He stressed the decision on whether to grant the go-ahead for development will only be made after an environmental assessment.
He told BBC Radio Scotland: “Each individual field needs to be given consent and needs to have an environmental study done on it, and I don’t want to pre-empt that.”
But he said the UK Government’s “general policy is to support the 100,000 oil and gas jobs that there are in the UK, principally in Scotland, and make sure we do not increase imports”.
Mr Hands added: “It would be crazy to increase our imports of oil and gas from abroad at a time when we have got good assets ourselves.”