Oil and gas producers that fail to commit to reducing their emissions to “net-zero” could face being rejected for North Sea drilling licences.
The government’s new business secretary, Kwasi Kwarteng, said companies would only get government backing if they took decarbonisation “very seriously indeed.”
The news comes amid a mounting tide calling for firms to clean up their act, as the government looks for ways to hit its targets to reach net-zero by 2050. It said in last month’s energy white paper that North Sea licensing would have to fall in line.
The Telegraph reported Kwarteng said at the Westminster Energy Forum before his promotion this month: “All the conversations I’ve had with Energy UK and the Oil and Gas Authority, I talk about quid pro quo; something for something. That quid pro quo means that government support is only going to be there if they take decarbonisation very seriously indeed.”
The Department for Business, Energy and Industrial Strategy spokesperson said: “The Business Secretary rightly set out how our review into the future of the oil and gas licensing regime seeks to ensure it remains compatible with our target to reach net zero emissions by 2050. This commitment also forms part of the Energy White Paper published last month.
“We will agree a transformational North Sea Transition Deal with industry in the coming months to create jobs, retain skills and deliver new business and trade opportunities to support the sector’s transition to a lower carbon future.”
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