AN SNP activist, a medical student and a retiree are to challenge the legality of UK Government subsidies for oil and gas in a landmark court case.

The High Court has ruled the three can take Business, Energy and Industrial Strategy (BEIS) Secretary Kwasi Kwarteng to court along with the state-owned Oil and Gas Authority.

That decision will see lawyers for Aberdeen-based Kairin van Sweeden, an SNP Common Weal activist and executive director of Modern Money Scotland, and two co-claimants try to convince senior judges that the current government strategy is unlawful.

If successful, the case could bring about a sea-change in North Sea operations.

Van Sweeden, whose father was an oil worker, said: "The UK Government repeatedly puts the interests of oil industry capital above the labour that creates it and, in fact, above all of our collective wellbeing as residents of the planet.

"Serious, committed environmental stewardship would see public money spent on a just transition right now, including funding for retraining and re-skilling towards new, green, stable jobs. The funnelling of public money into the big polluters’ pockets must be fiercely rejected by us all."

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Supported by the Paid to Pollute campaign, the trio — including 23-year-old Edinburgh University medical student Mikaela Loach and Kent retiree Jeremy Cox, a former oil refinery worker — are seeking a declaration from the court that the OGA's new strategy is unlawful because it encourages production of oil and gas that is not economic for the UK as a whole and conflicts with its legal duty to achieve net zero emissions by 2050.  

In a High Court order, Mrs Justice Thornton found their request for a judicial review was "in the public interest" and has "sufficient merit to grant permission" to proceed to a full hearing.  

Kwarteng, who sets OGA policy, and the agency have until the end of next month to submit their detailed grounds of defence, with the case expected to be heard by the end of the year and a decision following in early 2022.

The challenge revolves around the tax breaks that make the UK the most profitable country in the world for oil companies to develop big offshore fields.

The campaigners argue that the OGA’s interpretation of its legal duty to "maximise economic recovery" of oil and gas fails to take account of the billions of pounds of public money supporting the industry.

Responding on behalf of itself and Kwarteng's BEIS department, the OGA said: "We are all aligned in progressing the energy transition. However we are disappointed that the claimants are challenging the OGA strategy while claiming to represent environmental interests.

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"We remain firmly of the view that the OGA strategy, which includes net zero requirements on industry, is the primary tool the OGA has to hold industry to account on emission reductions, as well as ensuring pace on essential energy transition projects including carbon capture and storage."

Solicitor Rowan Smith of law firm Leigh Day, which is bringing the case on behalf of the campaigners, said: "Our clients are perfectly entitled to ensure that the government is sticking to its commitments on net zero emissions.

"They believe that the OGA’s strategy unlawfully contradicts these commitments, and unlawfully allows production of oil and gas that does not benefit the UK economy as a whole. The court agrees that this is arguable and warrants a full hearing."

Westminster has paid £3.2 billion in public funds to North Sea oil and gas firms since signing the Paris Agreement in 2015.

Subsidies worth hundreds of millions through relief on decommissioning offshore installations, reduced tax rates and tax allowances are granted each year.

In 2015-16 and 2016-17, more money was paid out to oil companies than was taken in in taxes and Shell alone received $99 million in tax back from the UK in 2020, according to its accounts.

The company increased its dividend in 2021 weeks after announcing plans to cut 330 North Sea jobs.

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The latest OGA strategy came into force in February, three months before the International Energy Agency (IEA) said that investment in fossil fuel production should stop this year in order to keep within the 1.5°C Paris climate target.

However, the UK Government has refused to rule out awarding new North Sea exploration licences and climate activists have urged ministers not to green-light the proposed Cambo oil field west of Shetland.

That development could extract as much as 170 million barrels of oil.

The Paid to Pollute campaign is coordinated by non-profit Uplift, which has input from Greenpeace UK, Friends of the Earth Scotland and  

Loach commented: "Legal action is a last resort. In a year when so many communities have been ravaged by heatwaves and extreme weather, the UK has to heed the IEA’s call to end investment in all new oil and gas projects that are driving this climate injustice."

Cox said: "The oil and gas industry needs deep, structural change that winds down production and invests in low carbon industries. We can’t do this while pumping billions into oil and gas to extract more and more fossil fuels."