Don't let the Oil and Gas Industry Offload Clean Up Costs on Taxpayers
Don't let the Oil and Gas Industry Offload Clean Up Costs on Taxpayers
This case is raising funds for its stretch target. Your pledge will be collected within the next 24-48 hours (and it only takes two minutes to pledge!)
Latest: Oct. 5, 2020
Unfortunately the judge has ruled against us in our judicial review.
I'm gutted and frustrated and I'm very sorry we didn't manage to convince the judge to rule in favour of protecti…Read more
Who am I?
I'm Eddie Thornton, I grew up a few miles from the sites currently under licence by Third Energy for oil and gas drilling. I have been campaigning against the Onshore fracking industry for years in North Yorkshire and other licence areas.
In July 2019, the Oil and Gas Authority (OGA) allowed the sale of Third Energy to York Energy, a company that was set up only months before and which appears to have total share capital of only £10.00. That’s right – a tenner!
The OGA has a duty under the law to consider whether approving such sales will leave the taxpayers holding the bag for the costs to clean up after these companies if they duck their duties or go bust. But the OGA claims it did not need to approve the change of control of Third Energy's licence to drill and frack its wells.
We are challenging this decision as my legal team consider that the OGA have acted unlawfully in determining that no approval was needed and conducting a shoddy and limited financial analysis.
The OGA has not said who will pick up the bill for decommissioning 20 well pads, 150km of pipelines and Knapton Power station if York Energy fails, but it’s not hard to see that it will almost certainly be left to us – the taxpaying public.
In the U.S., the government has been left with hundreds of millions of dollars of liabilities, as companies take what profits they can and abandon dirty fracking wells to corporate shells without the resources to safely plug the wells, remove the infrastructure and clean up the resulting mess.
Third Energy did not seek the OGA's written permission for the change of Control of the licence, nor did the OGA request an application for Change of Control of ownership to York Energy. Under the OGA's own guidance, this constitutes a very serious breach of the licence, requiring immediate revocation.
Should the challenge be successful, the OGA would have to reconsider its position and would have to justify any decision not to revoke the remaining oil and gas licences that were part of the Third Energy/York Energy deal.
How much we are raising and why?
Our full stretch target is £35,000 so please give whatever you can. Even a small amount makes a big difference!
I'd like to thank my legal team-Estelle Dehon at Cornerstone Barristers, Marc Willers QC at Garden Court Chambers, and Matthew McFeeley and Paul Stookes, instructing solicitors at Richard Buxton Environmental and Public Law, and the researchers and volunteers who have assisted in this case.
Oct. 5, 2020
Unfortunately the judge has ruled against us in our judicial review.
I'm gutted and frustrated and I'm very sorry we didn't manage to convince the judge to rule in favour of protecting the public.
Our case did however shine a spotlight on the OGA’s secretive process and makes clear that the OGA must assess the risks to the public purse of a sale of a fracking company like Third Energy. Despite OGA’s public statements to the contrary, the judgment makes it clear that the risk that cleanup costs fall to the taxpayer is real and needs to be considered when the OGA carries out its functions. The Judge found that, in substance, the OGA had done enough in this instance, but specifically criticised statements the OGA had made that their duty to consider the risks to taxpayers were “not directly engaged,” categorically ruling that “the duty is always engaged”.
For more detailed information about the ruling please see this Drill or Drop report.
We are considering, with our legal team, whether to appeal.
Thank you again for believing in our case.
On behalf of the whole team
July 16, 2020
Our case concluded yesterday, and the judge reserved his ruling on what turned out to be a very complex and technical hearing. Our barristers were happy with the questions Justice Knowles asked of the OGA's advocate, and we're hopeful that he will rule in our favour. I'm told the judgement will be given anytime between 2 and 6 weeks.
Whatever the outcome, we now have it stated in the High Court that the OGA has no power to enforce decommissioning, and according to it's barrister "If the company went out of business, liability would “trickle down” and the costs would fall on the landowner. Only if the landowner also became insolvent would the liability reach the government and the public purse"
It's hard to see how anyone would lease their land to a gas company knowing this.
I'd like to acknowledge the amazing efforts of Matthew McFeeley and Estelle Dehon in preparing such a complex challenge. Also, the remarkable powers of persuasion of Marc Willers QC who brought our case to life in court. Thank you to Helen Chuntso and Ben Dean for the research and all the FOIs. A special mention to my long suffering dad for helping with the fundraising and listening to me rant.
I'm very grateful for the generous donations made by over 700 people that have allowed us to take our challenge all the way to the High Court. We couldn’t have done it without you. On the evening of the first day in court we finally reached our fundraising target of £35,000!
I’m keeping the fundraising campaign going because our final cost estimates from the legal team have come in higher than expected. This is due to the fact that the hearing went to two days and the huge volumes of evidence submitted by the OGA.
You can read a full report of yesterday's proceedings on Drill or Drop
I will update our page again when we know more from the judge.
July 15, 2020
Day 1 in Court
Marc Willers QC spent most of the day laying out our case against the Oil and Gas Authority including that the regulator "backed Third Energy takeover despite concerns over decommissioning."
Drill or Drop attended the virtual hearing and published this excellent report of the proceedings.
We're in court again at 10.30am today (Wednesday).
Wish us luck!
July 13, 2020
We’re in court tomorrow – and we’re so close to reaching our target!
Thank you to everyone that has contributed so far! If you donated in the last 2 weeks your pledge has been doubled by a group of Ryedale residents meaning we are much closer to our fundraising target, but we’re not quite there yet…
We still need to raise more funds to be able to pay our legal team who have been working incredibly hard to prepare the strongest case against the Oil and Gas Authority.
Please can you to help by doing three things - they will only take a couple of minutes:
1) Contribute again if you are able.
2) Email 10 friends with the link to the case page and tell them about the campaign
3) Share the link to the CrowdJustice page on Facebook, Twitter and Instagram - LINK HERE: https://www.crowdjustice.com/case/dont-let-the-taxpayer-pay-to-clean-up-fracking/
Thank you for your generosity in getting us this far and look out for updates on Crowd Justice and Drill or Drop
June 26, 2020
Our court date is two weeks away – all donations now doubled!
Firstly, I’d like to thank everyone who has donated to my CrowdJustice appeal so far. Your generosity is enabling me to challenge the Oil and Gas Authority’s decision to allow the sale of Third Energy to York Energy, a newly incorporated company which appears to have a total share capital of only £10! You can find out more about the case later in this update.
ALL DONATIONS ARE NOW BEING DOUBLED!
I have some exciting news! Because of the national importance of this case, a group of Yorkshire residents have agreed to match all further donations up to £6,000. I realise that you may have already donated to our legal funds, but if you are able to make another contribution, however small, this will now be doubled, meaning your donation will have twice as much impact. To donate, click here. Match funding for your donation will be added to the CrowdJustice page just before the court hearing.
If you aren’t able to chip in again, then please share this email with your friends and family. And if you’re on Facebook, there’s a short text at the end of this update you can cut and paste onto your timeline.
SHOULD THE PUBLIC HAVE TO PAY OIL AND GAS COMPANIES’ CLEAN-UP COSTS?
We have a court date and the Oil and Gas Authority is in trouble! After many frustrating weeks trying to get the regulator to disclose unredacted evidence vital to our case, we forced the OGA to disclose their “analysis” and we have a court date on 14th and 15th July. Our case exposes the fact that the OGA is failing in their duty in law, and instead acting as a facilitator of onshore oil and gas licencing. The regulator is failing to prevent financially incompetent companies from taking on drilling operations that risk leaving the public with a huge clean-up bill.
Shockingly, there is no provision in law for onshore operators to be required to clean up their mess if they go bankrupt, therefore the importance of this case cannot be overstated on a UK wide level.
Given that most licence holders in the UK are small start-up companies with little or no working capital, should they collapse, the taxpayer will pick up the bill for decommissioning their entire operations. Our case aims to ensure that the OGA will properly scrutinise companies taking over drilling and fracking operations.
Should the courts find that the OGA acted unlawfully, the power of revocation in Schedule 2, Sec 41 of the 2014 Model Clauses means Third Energy could lose its licences. The company will then be forced to use its remaining cash to decommission its gas field rather than using every last penny on a gamble that it will ‘strike it rich’, or simply allowing Cayman-based corporate raiders to take the funds offshore.
Our case will put the UK Oil and Gas regulator on the ropes. We will have demonstrated that they have failed to apply the law and protect taxpayers. Any future transactions by other licenced companies will be required to undergo proper financial testing and companies will be forced to use their remaining resources on clean-up rather than a desperate hunt for new oil and gas. Our case aims to end to the onshore operations in the UK for all the small-time cash strapped operators that put the public purse at risk.
Thank you again for your fantastic support, and I’ll report back to you after the court hearing. And if you’d like to make a donation to help the cause, please click here. All donations now doubled!
PS If you’re on Facebook, please cut and paste this short text onto your timeline to spread the word.
SHOULD THE PUBLIC PAY FOR OIL AND GAS CLEAN-UP COSTS?
Taxpayers could be left with a huge clean-up bill if oil and gas companies go bankrupt. Eddie Thornton is going to court to challenge this. To find out more and make a donation, please click below. ALL DONATIONS ARE NOW BEING DOUBLED!
June 5, 2020
We have our Court date!
The Oil and Gas Authority has failed to recognise its legal duty to protect the public from decommissioning costs. Please help us take them to court.
After many frustrating weeks trying to get the Oil and Gas Authority to release evidence vital to our case, we are very happy to announce we have a (virtual) court date!
The Court has recognised the importance of our case, ordering that it must be heard by a Justice of the High Court, not a deputy judge, over 2 days on the 14th and 15th July. Due to the current pandemic, the case will be heard via video conferencing.
The evidence submitted by the Oil and Gas Authority shows the regulator thought it did not need to consider the risk to taxpayers despite its clear legal duty to do so.
We have been granted permission by the Court to use additional expert evidence which shows that the OGA did not properly assess the financial capacity of York Energy before allowing the takeover. The Caymans-owned company with UK assets of only £5.00 was paid millions by Barclays to take failing Third Energy off their hands, letting Barclays off the hook for the clean-up costs.
The new expert evidence also shows that there is a real risk that the directors of York Energy will simply take those millions offshore and let the company fail, leaving taxpayers to clean up the mess. Instead of using its powers to ensure that the terms of the sale wouldn’t allow this, the OGA says that it isn’t even required to review the sale under their rules. Our legal team say this is a clear legal error.
Our case highlights the worrying lack of protection for communities living in oil and gas fields across the UK. Please help us hold the Oil and Gas Authority to account and protect the public from the clean-up costs when oil and gas companies go bust.
Please support with a donation if you are able. Ask friends and family to help also. Then, please post on social media to remind people of that this case is still alive and needs support.
Feb. 25, 2020
We’re going to court!
The High Court has ordered a hearing of our Judicial Review. Please help us reach our fundraising target of £35,000 and protect communities around the UK from the clean-up costs of onshore oil and gas.
A judge has ordered a rolled-up hearing of our legal challenge against the Oil and Gas Authority (OGA) which means the grounds of our argument will be heard in a full High Court hearing lasting on to two days.
In granting the hearing, Judge Supperstone also permitted a fourth and pivotal ground of claim, which arose due to OGA disclosures made during the case. The OGA believes it is not responsible for ensuring that decommissioning liabilities are met by the operators, despite its clear statutory duty to protect the taxpayer!
Our legal team will argue that the Oil and Gas Authority:
- Misinterpreted the legislation that governs the change of control of petroleum licences
- Failed to assess financial capability of the companies in the sale of Third Energy
- Failed to undertake all aspects of the proper financial capability assessment
- Failed to take into account the serious risk that change of control would lead to Third Energy Gas being unable to pay for decommissioning activity when it falls due
This comes on the same day that news broke that government ministers intervened on behalf of Barclays bank in the takeover of Third Energy.
Our legal team is confident that the Oil and Gas Authority failed to follow the law when waving through the takeover. Estelle Dehon of Cornerstone Barristers will be representing me alongside Marc Willers QC, of Garden Court Chambers.
Ms. Dehon said:
“The sale of Third Energy shows how vital it is for there to be proper financial regulation of fracking companies. The fracking boom has been built on low interest rates feeding capital into high risk ventures with shaky cash-flows and questionable economics. Mr Thornton’s claim has uncovered that, despite the OGA identifying a “foreseeable risk” that, after the transaction, Third Energy “will be unable to pay for decommissioning activity when it falls due and despite informing DBEIS that “[t]here are… risks associated with allowing the Transaction… and the OGA cannot provide any assurance that [Third Energy] will ultimately be able to meet its licence commitments, including decommissioning”, the OGA supported the sale. This is not robust regulation. Nor was it lawful, given the OGA’s legal duty to assess whether fracking companies have financial capacity to discharge their decommissioning obligations.
We need to raise £35,000 to pay our legal fees. Please help us bring our case to the High Court.
Oct. 23, 2019
Today we filed our High Court Challenge
Last week, on my birthday we reached our initial fundraising target of £10,000 and Today our lawyers filed our legal challenge against the Oil and Gas Authority!
Donations from more than 200 people have allowed us to initiate proceedings and instruct a public finances expert.
To take this all the way to the High Court we're going to need more funds, so we've raised our target to £35,000. It's a heck of a lot of money but it will be well spent when we win!
Here’s a link to the BBC report on our legal challenge. Please share the video and our fundraising page and help us take the case to the High Court
Thank you so much for helping us get this far
Oct. 12, 2019
We’re getting close!
Thank you so much to the 164 (and counting) people who have pledged to help our legal case against the Oil and Gas Authority. We’ve almost made it to 75% of our £10,000 target
Right now, our lawyers are drafting papers to initiate proceedings against the OGA, so we need a big push to meet our fundraising target.
Please continue to share our Crowd Justice page on social media. It really helps - the vast majority of pledges have come through Facebook. Also, don’t forget that you can pledge twice (!).
It would be really good to also reach people by email, so please consider sending the link with the following message to anyone interested in climate change and social justice.
Thank you for helping us get this far.
Suggested text for sharing -
Don’t let the oil and gas industry offload clean-up costs on taxpayers
My CrowdJustice page is now live on https://www.crowdjustice.com/case/dont-let-the-taxpayer-pay-to-clean-up-fracking/.
We are fundraising to take legal action against the Oil and Gas Authority for failing in its duty to protect the taxpayers from the cost of decommissioning oil and gas sites. This is an issue that affects any area of the UK where there is an onshore drilling licence.
When York Energy took over 100% of Third Energy shares, The OGA failed to apply the law specified in their regulations. This could leave the taxpayer picking up a multi-million pound bill to decommission the Third Energy gas infrastructure. My legal tam believes that the OGA should have undertaken a proper assessment of the new company, who we can see only has £10 on the books.
We need to hold the government to account and you can help by taking action today
· Pledge any amount you can via https://www.crowdjustice.com/case/dont-let-the-taxpayer-pay-to-clean-up-fracking/.
· Share the page on all your social media.
· Ask family, friends, work colleagues and groups to consider pledging to the CrowdJustice page via the above link and for them to share with their family friends etc. Ask each recipient to share with 5-10 people or more, with the link to our page.
We have reached 75% of our initial target. With another big push, we can reach our £10,000 goal.
Thank you very much.
Oct. 3, 2019
What a day! A fantastic opening 12 hours. Thank you for the generous pledges.
Well that has been an amazing day. A step into uncertainty then suddenly I am much more confidant we can make the target. Thank you all who have shared and pledged so generously. We are happy with any donation, large or small, it all helps. You dont even need to publish your name. It was very heart warming to see the total inching up to a tantalising £2918 so I expect it will cross the £3000 threshold before the bedtime. Thank you for the pledges which all help to get Eddie into Court.
The pledges will not be taken from your bank account until we cross the target of £10,000 so please be aware. When we do reach that level the money is taken from your card and transferred to start the payments to solicitors and barristers. The process then has further targets but all the money donated then will go towards the legal case, it is only the first £10 target that is make or break.
It is hugely helpful if you can talk to people about the case, share the link to the CrowdJustice page and contact family friends and groups to encourage them to support. Please use your social media to inform your followers and beyond that this case is live and in need of their support.
Thank you to all who have helped us get this far, and for all of you who can promote this further.
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