Shell exits North Sea Cambo development
Environmentalists campaigned against project, saying it contravenes U.K. goals
The development of a controversial North Sea oilfield appears less likely after Royal Dutch Shell Plc judged it economically unviable in a big win for environmentalists.
“After comprehensive screening of the proposed Cambo development, we have concluded the economic case for investment in this project is not strong enough at this time, as well as having the potential for delays,” a Shell spokesperson said Thursday in a statement.
Environmental groups have campaigned against Cambo, saying the project is at odds with the U.K.’s goal of reaching carbon neutrality by 2050. Despite that opposition, Shell chief executive officer Ben Van Beurden publicly supported the field until recently, arguing that the investment was needed to slake ongoing British demand for oil and natural gas.
The project, operated by Siccar Point Energy Ltd. and co-owned by Shell, had to delay work earlier this year while waiting for regulatory consent following pressure from Greenpeace and other groups.
Despite being one of the U.K.’s biggest potential oil-and-gas projects, the Cambo field is a relative minnow globally, with the first phase of development targeting the equivalent of 170 million barrels of crude. Still, the field became a flash point between activists, project partners and the U.K and Scottish governments.
In October, a Scottish activist walked off a panel that included Van Beurden because of the company’s involvement in Cambo.
“Let me be very clear, as long as the U.K. still needs oil and gas in its consumption for its society, it’s better to produce it in its own backyard,” the Shell chief said earlier this year.
Siccar said in a separate statement it would continue to engage with the U.K. government and stakeholders on future development of the field.
“Cambo remains critical to the U..K’s energy security and economy,” Siccar CEO Jonathan Roger said in the statement. “Whilst we are disappointed at Shell’s change of position, we remain confident about the qualities of a project that will not only create over1,000 direct jobs as well as thousands more in the supply chain, but also help ease the U.K.’s transition to a low-carbon future.”