Zack Polanski has challenged Foreign Secretary Ed Miliband to block the Rosebank oil field, claiming the project could test whether Labour’s sanctions on companies linked to Israeli settlements have any force.
The Green Party leader has written to Miliband demanding clarity over whether Ithaca Energy, which holds a 20 per cent stake in Rosebank, could be affected by the government’s proposed sanctions regime.
Ithaca is controlled by Israeli energy company Delek Group, which Polanski has targeted because of its inclusion on a UN database relating to companies associated with Israeli settlements in the territory.
Delek disputes the listing and says it intends to challenge its inclusion.
In his letter to Miliband, Polanski said the government needed to explain how its proposed measures would apply to Ithaca.
“In respect of your proposed sanctions package, we would welcome clarity on your position on Ithaca Energy, the Aberdeen-based company that is a subsidiary of Israeli firm Delek Group,” he wrote.
“Since 2000, Ithaca has already paid over $1bn (£754m) in dividends from its UK oil and gas interests to the Delek Group.
“This amount would soar if the government gives the green light to new drilling projects in which Ithaca Energy has a stake.”
Polanski argued that the issue went beyond the ownership structure of one North Sea company, presenting Rosebank as a test case for Labour’s proposed policy on settlement-related business.
“Rosebank is a test of whether Labour’s proposed sanctions regime is fit for purpose,” he said.
“Companies listed by the UN as operating in the illegal settlements should not be financed by oil and gas revenues from the North Sea,” Polanski added.
“This should be a red line, and yet the Government seems to be getting ready to greenlight Rosebank.”
Polanski’s letter comes after the government committed to introducing new measures targeting companies involved in activity connected to Israeli settlements in the West Bank.
He argues that ministers cannot simultaneously threaten sanctions against businesses linked to settlements while allowing a company connected to the same wider corporate network to benefit from new UK oil and gas development.
He has also raised concerns about Cambo, another North Sea oil field in which Ithaca has an interest.
Rosebank is located around 80 miles north-west of Shetland and is being developed by Adura, a joint venture involving Shell and Norway’s state-controlled Equinor, alongside Ithaca.
The field is estimated to contain hundreds of millions of barrels of recoverable oil and gas and has become a major point of contention over Britain's future energy policy.
Supporters argue that developing North Sea resources can contribute to domestic energy security and economic activity, while opponents have questioned the climate impact and economic case for new oil and gas extraction.
Development of the field was initially blocked by a court order to conduct a more comprehensive environmental assessment and was previously opposed by Miliband when he was energy secretary.
However, once that assessment is completed, ministers will then be able to decide whether to allow extraction to go ahead.
Ithaca strongly rejected the suggestion that its corporate structure should make it a target for sanctions.
A spokesman said the company was listed on the London Stock Exchange and was “governed by the highest standards of corporate governance”.
“Ithaca is one of the biggest investors in the North Sea and Scotland, is a responsible employer and is a major contributor to both the UK Treasury through tax payments, and to the UK’s energy security,” the spokesman said.
“Delek Group has been wrongly included in the UN database,” a Delek Group spokesman explained.
“Together with our legal advisers, we intend to formally challenge this and request the immediate removal of our name from the UN database.”
Polanski is expected to make opposition to new North Sea oil and gas developments a prominent part of his message at the Green Party's annual conference, which opens in Brighton on Friday.
His intervention also comes as he campaigns for the October 8 by-election in Holborn and St Pancras, Sir Keir Starmer's former parliamentary constituency.
“If companies listed by the UN as operating in illegal settlements are subject to sanctions,” Polanski argued, “then the Government must explain why revenues from UK oil and gas projects should flow to a company connected to one of those businesses.”
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