Nobel Oil E&P North Sea Limited, R (on the application of) v The Oil and Gas Authority t/a The North Sea Transition Authority & Ors

A specialist regulator may prioritise its finite resources when exercising supervisory functions, provided it acts rationally, complies with its statutory framework and keeps an open mind. It need not undertake detailed economic modelling where its expert judgment, based on the available material, reasonably supports the conclusion reached.

Maximum economic recovery remains the principal objective. The obligation to assist with the net-zero target operates in that context and does not create a competing objective. A regulator may nevertheless consider emissions and societal carbon costs when assessing economic recoverability.

Procedural fairness is context-specific. A non-statutory participant need not receive the same engagement or confidential information as the statutory consultee. The judicial review claims therefore failed.

The claimant held interests in the Maclure and Ballindalloch oil fields, which were tied back to the Gryphon floating production, storage and offloading vessel owned and operated by Total. Total proposed cessation of production and decommissioning.

The claimant challenged two stages of the statutory process under the Petroleum Act 1998: advice given by the North Sea Transition Authority to Total under section 29, and advice given to the Secretary of State under section 32. The claimant alleged predetermination, procedural unfairness, failures concerning maximum economic recovery, inadequate inquiry and reasons, errors in assessing continued use and divestment, and incompatibility with article 1 of Protocol 1 to the ECHR.

The central issues were whether the advice was unlawful and whether either claim should be entertained before the Secretary of State’s decision on the decommissioning programme.

1. Disposition. JR1 was dismissed and permission for JR2 was refused. The court decided the claims on their merits and therefore did not determine the preliminary issues of justiciability, prematurity or academic character.
2. Predetermination, bias and fairness. The applicable apparent-bias inquiry required assessment of all relevant circumstances and whether a fair-minded and informed observer would conclude that there was a real possibility of predetermination or bias. The regulator was entitled to have a strategic view and prioritise resources. An open mind did not require an empty mind. The evidence, viewed in context, did not establish predetermination, bias or procedural unfairness.
3. Fairness depended on the statutory function. Total was the party required to consult the regulator. The claimant had ample opportunities to make representations and was not entitled to parity of engagement or disclosure of commercially confidential material.
4. MER and net zero. The regulator acted lawfully in treating maximum economic recovery as the principal objective while considering appropriate steps to assist the Secretary of State with the net-zero target. It was entitled to consider the installation’s emissions and societal carbon costs. Net zero was not treated as a competing objective.
5. Economic inquiry and expert judgment. The regulator was not legally required to undertake detailed economic modelling before giving section 29 advice. Its assessment that the remaining resource was not a regulatory priority was rational. Under Wednesbury and Tameside principles, the court would not substitute its view for that of the specialist regulator on modelling inputs, forecasts or technical risks.
6. The section 32 advice lawfully treated paragraphs 26 to 30 of the Strategy as inapplicable because the planned cessation was found consistent with MER. In any event, the claimant’s proposal lacked sufficient commercial, regulatory and operational detail and was not shown to be a realistic alternative.
7. The regulator reasonably concluded that decommissioning costs were being minimised in the circumstances as they existed, including the accelerated cessation date. An error concerning operating-cost data was reconsidered and did not affect the substance of the advice.
8. The reasons given were intelligible and adequate. Since no unlawful conduct was established, the article 1 of Protocol 1 claim could not succeed.

This was a first-instance decision of the Divisional Court of the King's Bench Division on two judicial review applications. JR1 was dismissed. Permission for JR2 was refused.