Shell has pulled out of the proposed Cambo oil field development west of Shetland.
Located approximately 125 kilometres to the west of Shetland, the Cambo oil field could see drilling start as early as 2022 if approved by the Oil and Gas Authority.
A Shell spokesperson said: “The economic case for investment in this project is not strong enough at this time, as well as having the potential for delays.
“However, continued investment in oil and gas in the UK remains critical to the country’s energy security.
“We believe the North Sea and Shell in it has a critical role to play in the UK’s energy mix, supporting the jobs and skills to enable a smooth transition to Britain’s low carbon future.”
Siccar Point Energy, which confirmed that its partner in the Cambo development Shell has taken the decision to not progress its investment at this stage, pledged to continue to engage with the UK Government on the future development of Cambo.
Jonathan Roger, Chief Executive Officer of Siccar Point Energy, said: “Cambo remains critical to the UK’s energy security and economy.
“Whilst we are disappointed at Shell’s change of position, we remain confident about the qualities of a project that will not only create over 1,000 direct jobs as well as thousands more in the supply chain, but also help ease the UK’s transition to a low carbon future through responsibly produced domestic oil instead of becoming even more dependent on imports, with a relatively higher carbon intensity.”
Environmentalists had previously criticised the Cambo oil field proposals.
ClientEarth’s Climate Accountability Lead Sophie Marjanac said: “New oil and gas projects are reckless for the climate and the economy. If the government doesn’t start phasing out UK oil and gas and focus on a just transition for workers – like other major economies promised to do, at COP26 – it’s only setting up the industry for chaotic collapse. And we’ll see more of this risky approach to investment in the meantime.
“The government’s persistent refusal to rule out new fossil fuel projects, such as this high-cost, carbon-intensive oilfield, is wholly inconsistent with its pledges on climate. Approving new oil and gas threatens to derail global efforts to curb emissions and limit global heating to safe levels