Labour MPs press leadership not to overrule energy secretary on Rosebank oilfield

Labour MPs have been lobbying the prime minister and the chancellor to ensure the energy secretary is not overruled if she decides to block the Rosebank oilfield, according to the Guardian.

The backbench alarm follows reports of divisions in cabinet. Sources had said Miatta Fahnbulleh was minded to refuse environmental permission for the field. Sources close to the chancellor, John Healey, have since made clear he favours the scheme, and some in government believe the prime minister, Andy Burnham, also wants it to proceed.

Backbenchers concerned about the environmental impact are now urging their whips and Downing Street not to let other ministers interfere. Catherine Fookes, a Labour member of the energy select committee, said approving Rosebank would "blow a hole in our green credentials". She added that a group of MPs was telling the leadership that the decision should be Fahnbulleh's, and that it would go against the thrust of the party's manifesto.

Another MP warned that "there will be blood" if Healey pushes the field through, calling it economically shortsighted and politically explosive. A third said the position Fahnbulleh had been put in by the briefings was "intolerable". Concerns have also reportedly been raised with Healey directly in budget meetings with MPs.

Fahnbulleh's parliamentary aides have circulated a memo to MPs stating that no decision has been made. It says the energy secretary is the only decision maker in a quasi-judicial process, and that no other cabinet member or minister has any role in it or sees the advice. The memo was sent after several MPs contacted her aides fearing she would be overruled.

Burnham has promised a "pragmatic" approach to North Sea drilling and described the Jackdaw gasfield, approved by the government last week, as "a bridge to the future". He insists the Rosebank decision is for Fahnbulleh alone. However, he prompted speculation about his leanings on Wednesday when he told the Commons that using the UK's reserves can support and accelerate a clean energy future. Many in government believe Rosebank could be approved without breaching carbon commitments, partly because most of its oil would be exported.

The Guardian also reported on Tuesday that the Treasury had already factored in tax revenue from the scheme, expected to reach about £500m by the end of this parliament. Treasury officials said the money had been in Office for Budget Responsibility forecasts since 2019 and would not prevent the energy secretary from blocking the field. The OBR said its projection includes the North Sea Transition Authority's estimate of production from new fields, including Rosebank, and that without any new fields output would decline by around 14% a year.

Some Labour MPs believe the Treasury is using aggressive tactics against the energy department, with one describing No 11's approach as "macho bullshit". Clive Lewis said the UK cannot claim global climate leadership while approving new oilfields because tax receipts have been pencilled in, adding that those figures appear to be the operator's estimate rather than actual Treasury revenue.

Analysis by the campaign group Uplift found that, on government and industry estimates, the tax take from Rosebank would probably be limited and could be outweighed by tax breaks and incentives for development and decommissioning. Areeba Hamid of Greenpeace UK said the revenue would leave public services exposed to future oil prices and taxpayers liable for decommissioning costs for decades.

MPs said a significant parliamentary rebellion is likely over Rosebank, unlike with Jackdaw, where they were prepared to accept the case for extracting gas for domestic use. Fookes said the case was made for Jackdaw to some degree and MPs stayed quiet, but that Rosebank is a different issue.