Shell pulls out as investor in Cambo North Sea oilfield

The planned project has been the focus of protests by environmental campaigners

The Cambo project was the focus of campaigning against new oil developments in the North Sea at the UN's climate change summit in Glasgow last month. PA

Shell has scrapped plans to develop the Cambo oilfield in the North Sea off the coast of Scotland, which had become the focus of protests by environmental campaigners trying to stop new projects in a bid to slow global warning.

The oil major pulled out saying the economic case was not strong enough and there was the potential for further delays. The Cambo backers had faced legal challenges to the project with campaigners saying it was not in line with the UK government’s commitment to become net zero by 2050.

Shell owned 30 per cent of the project, while operator Siccar Point holds the remaining 70 per cent. Siccar Point signalled it would continue to press ahead with the project.

The field could produce up to 170 million barrels of oil equivalent and 53.5 billion cubic feet of gas over 25 years, according to Siccar Point.

“Cambo remains critical to the UK's energy security and economy," Siccar Point Chief Executive Officer Jonathan Roger said.

“Whilst we are disappointed at Shell’s change of position ... we will continue to engage with the UK Government and wider stakeholders on the future development of Cambo.”

The International Energy Agency said no new oil and gas projects should be developed to restrict global warming to 1.5C. The slogan – keep 1.5 alive – was adopted by the UK government as it hosted the UN’s climate change summit in Glasgow last month.

London declined to join pledges to stop new oil and gas developments on their territory and Boris Johnson, the prime minister, insisted existing contracts could not be torn up in the battle against global warming.

Friends of the Earth, an activist group that won a climate court case against Shell in the Netherlands this year, welcomed the move.

"The future of the project is now in serious doubt - as it should be. There is no need for a new oil field during a climate crisis," the group said on Twitter.

Ed Miliband, the opposition spokesman on climate change, said Shell’s withdrawal marked a significant turning point in the fight against the oil field.

He called for a rapid acceleration of renewable projects and the UK to be positioned as a world leader of green energy.

"Shell have woken up to the fact that Cambo is the wrong choice. It's long past time for the Government to do so,” he said.

Updated: December 3rd 2021, 10:18 AM