UK lays out North Sea oil and gas phase-out plans

The UK government has confirmed that it will no longer issue licenses for new oil and gas exploration in the North Sea, while providing support for oil and gas workers to transition to clean energy jobs.

After world leaders at COP30 failed to deliver a roadmap for the global phase-out of fossil fuels, the UK is positioning itself as a beacon of ambition for the energy transition. After decommissioning its last coal plant in 2024, the country has announced plans to gradually phase out oil and gas production in the North Sea.

“Our plan for future oil and gas production needs to meet both our obligations to today’s workers as well as our climate obligations to future generations. We are determined to meet our commitment to manage existing oil and gas fields for their lifetime and not to issue new oil and gas licenses to explore new fields,” the government said in a paper on Wednesday (November 26).  

A ‘bitter blow’ for oil and gas, a ‘major milestone’ for environmentalist

With the strategy, the country has conceded to some of the sector’s demands – allowing for new production licenses on existing oil and gas fields through ‘Transitional Energy Certificates’ – but maintained a windfall tax that companies in the sector wanted scrapped.

Lobby group Offshore Energy UK called the decision to keep the Energy Profits Levy “a bitter blow” to the country’s energy sector, and said some companies – including NEO NEXT Energy and its partners, Serica Energy and Jersey Oil and Gas – are already reconsidering expansion plans as a result.

But this is exactly what environmental organisations have been campaigning for. Greenpeace UK’s co-executive director, Areeba Hamid, said: “Britain has just made history. Closing the door to new exploration marks the beginning of the end of oil and gas in this country. By standing firm on its manifesto promise, the government has shown genuine global climate leadership, making the UK the world’s largest economy to call time on new fossil fuel exploration. This is a major milestone.”

£20 million to upskill oil and gas workers for the energy transition

At the same time, the UK government announced a plan to support energy workers in the North Sea to transition to other jobs. A new North Sea Jobs Service will serve as a national employment programme offering support for the current workforce seeking new opportunities in industrial strategy sectors such as clean energy, defence, and advanced manufacturing.  

This builds on the expansion of the Energy Skills Passport to new roles and sectors, and up to £20 million funding from the UK and Scottish Governments, following demand for the Aberdeen skills pilot to help oil and gas workers retrain, the government adds.

However, the investment is seen as insufficient: “The current plan – and the cash – to support North Sea workers doesn’t go far enough. It’s vital they are at the heart of Britain’s transition to a clean-energy superpower, not left behind by it – but a £20mn jobs package doesn’t cut the mustard. A fair transition will create thousands of new jobs, strengthen communities, and prove that climate leadership and economic security can go hand in hand,” added Hamid at Greenpeace.