The recent decision in R (on the application of Nobel Oil E&P North Sea Ltd) (“Nobel”) v Oil and Gas Authority (trading as the North Sea Transition Authority) (“NSTA”) addressed the court’s jurisdiction to grant a stay of the approval process for a decommissioning programme under the Petroleum Act 1998 in the context of judicial review proceedings and the circumstances in which a cross-undertaking in damages is required in the context of such an application for interim relief.
Background
Nobel sought a stay to prevent the approval by OPRED of a decommissioning programme for an FPSO unit crucial to two of its North Sea oilfields pending the outcome of its judicial review challenge concerning a step in the approval process.
The draft decommissioning programme for the FPSO, submitted in September 2023 by the owners of the FPSO (who were interested parties in the proceedings), proposed cessation of production at the FPSO between 2024 and 2025.
The claimant commenced judicial review proceedings to challenge advice that had been given by the NSTA in the context of the statutory approval process for the decommissioning programme, and sought a stay of the approval process to “hold the ring” pending the outcome of those proceedings, but would not provide a cross-undertaking in damages to support the stay application. The interested parties opposed the stay application, arguing the challenge was aimed at advice rather than a final decision, that an injunction was the proper remedy, and that a cross-undertaking from the claimant was needed due to the potential financial harm that the interested parties would incur if a stay was to be granted.
Requirements of s29 and s32 of the 1998 Act
Owners of offshore oil & gas infrastructure are required to decommission that infrastructure, once production from the oil & gas fields served by the infrastructure has ceased. Before commencing work to do so, they are required to obtain approval of a decommissioning programme (referred to in legislation as an abandonment plan) in accordance with Part IV of the Petroleum Act 1998 (the “1998 Act”), which sets out various requirements in relation to the process to obtain that approval.
Although the decision to approve a decommissioning programme rests with the Secretary of State (in practice acting through the Offshore Petroleum Regulator for Environment and Decommissioning (“OPRED”)), the process includes requirements (at sections 29 and 32 of the 1998 Act respectively) that the NSTA considers and advises (i) the parties submitting the decommissioning programme; and (ii) OPRED in respect of specified matters (in particular, potential alternatives to decommissioning and ensuring costs are kept to the minimum reasonably practicable).
Court’s Decision
Jurisdiction to Grant a Stay
CPR r.54.10 provides that, where permission has been given for judicial review proceedings to proceed, then the court may also give directions which may include “a stay of proceedings to which the claim relates”. In this instance, the proceedings which Nobel sought to have stayed were not judicial proceedings but rather the regulatory approval process in connection with the decommissioning programme for the FPSO.
The court confirmed its jurisdiction to grant a stay of an administrative decision-making process, including the approval of a decommissioning programme under the Petroleum Act 1998. The court recognised that a stay of this nature was akin to an injunction but considered that it was not appropriate to take too technical or narrow an approach. It considered that its power under CPR r.54.10 extends beyond judicial or quasi-judicial proceedings to cover administrative actions by public bodies. The court highlighted that a stay can maintain the status quo and safeguard the effectiveness of judicial review, especially when the process in question involves a series of interconnected decisions, where procedural fairness may require scrutiny at each stage of the process.
Requirement for Cross-Undertaking in Damages
The court assessed whether a cross-undertaking in damages should be required as a condition for granting a stay in these circumstances. While such an undertaking may not be needed if the potential losses would arise from the voluntary conduct of the party seeking the cross-undertaking, the court considered that, in this instance, the complexity and scale of the decommissioning process meant that delays would inevitably lead to substantial costs. It was unclear whether the interested parties were at fault for any delays, and the court was unable to resolve that issue at this stage. Weighing the balance of convenience, the court considered that it would not be just or convenient to waive the cross-undertaking in damages. As the claimant refused to provide one, the application for a stay was denied.
Key Takeaways
- The court has jurisdiction under CPR r54.10 to stay administrative decision-making processes such as decommissioning approvals under the Petroleum Act 1998.
- A stay may be granted to preserve the status quo and facilitate effective judicial review, even where the process being challenged involves multiple interdependent decisions.
- A cross-undertaking in damages will generally be required where a stay may cause financial harm to other parties, unless it is clear that any losses would be the result of their voluntary conduct.
- Where a claimant is unwilling to provide a cross-undertaking in damages in such circumstances, a stay is unlikely to be granted.
Unusually, the decision was handed down ex tempore rather than in a written judgment, (although reported at [2025] 5WLUK30). Nonetheless, this decision provides important confirmation regarding the interim remedies that may be available in the context of decommissioning approvals in the UK oil and gas sector.
A report of the judgement can be found here: [2025]5WLUK30.
Article prepared with assistance from Poppaea Watt, CMS
