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A landmark High Court ruling has upheld more than two dozen North Sea oil and gas exploration licences, dealing a significant blow to environmental campaigners who argued the government failed to account for climate and marine damage. The decision marks a rare legal victory for the fossil fuel industry, which has faced mounting court challenges over the past year.
What Happened
The High Court dismissed a judicial review challenge brought by Oceana UK, a marine conservation organisation, against 28 oil and gas exploration licences granted by the previous Conservative government in May 2024. Judge Tim Mould ruled that the licences were lawful, rejecting claims that regulators had unlawfully ignored environmental risks.
Oceana UK argued that the North Sea Transition Authority had failed to properly assess damage to marine life from potential oil spills and had not adequately considered the climate impact of burning the extracted fossil fuels. The organisation contended that the licensing decisions breached environmental protection laws, particularly given that the licences cover marine conservation areas designated to protect species including puffins, seals, and fish.
Despite these arguments, the court upheld the original approvals, finding that the government’s position was sound on the basis that these were early-stage exploration licences requiring further assessment before any production could occur.
Why It Matters
This ruling provides crucial legal certainty for oil and gas operators in UK waters at a time when the industry has been battered by unfavourable court decisions and political headwinds. The decision contrasts sharply with recent legal setbacks, including the Scottish Court’s January 2025 decision to overturn approval of two major North Sea oilfields and the Supreme Court’s 2024 ruling requiring planners to account for emissions from burning fossil fuels.
The judgment suggests that environmental law around fossil fuel licensing may be more restrictive at later approval stages rather than at the exploration phase. However, Judge Mould noted that any adverse environmental impacts on marine habitats must be evaluated at every subsequent stage, offering some reassurance to conservation groups.
Key Details
The licences were part of the 33rd oil and gas licensing round and are expected to unlock 600 million barrels of oil equivalent. The case represents the latest attempt by environmental campaigners to use judicial review as a tool against fossil fuel expansion, following the influential “Finch ruling” that established emissions from fuel burning as a relevant consideration in environmental assessments.
The current Labour government, which imposed a ban on new exploration licences in July 2024, nonetheless opposed Oceana’s legal challenge in court. Ministers argued that defending existing decisions was more appropriate than allowing them to be overturned. Energy Secretary Ed Miliband confirmed this week that the exploration ban would remain in place with minor relaxations, though the ruled licences will continue to stand.
What Comes Next
The ruling ensures that these exploration licences remain valid, though substantial hurdles remain before production can commence. Companies will need to secure additional approvals before moving to the development and production phases, where environmental scrutiny is likely to intensify.
For environmental groups, the decision signals a need to shift their legal strategy toward later licensing stages. Hugo Tagholm, Oceana UK’s executive director, stated that while the legal challenge had failed, granting consent to production does not automatically mean existing licences will be honoured, leaving potential leverage for future challenges as individual projects advance.
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