Norway’s expanded oil exploration deemed lawful

Posted by: Frances Lawson

An interesting feature of 2018 is that adults and children are divided by the millenium in which they were born. It is perhaps fitting that the judgment in the Greenpeace Nordic and Nature and Youth v Ministry of Petroleum and Energy (referred to by the claimants as The People v Arctic Oil) was delivered in the first week of the new year. In their media briefings, the claimants framed the case as between the irresponsible indulgences of politicians and the future of today’s youth. As Attorney Michelle Jonker-Argueta put it: “This is about climate justice for us, our nieces and nephews, all children.”

The facts of the case and the competing arguments have been explained in a recent blog post. In short, with the support of over 500,000 signatories obtained through a slick media campaign, Greenpeace Norway and youth organisation ‘Nature and Youth’ sought a quashing order with respect to a decision by the Government to issue licenses for petroleum exploration. Motivated by the dangers presented by climate change, the claimants contended that this decision breached a constitutional ‘right to a healthy environment’ provided by Article 112 of the Norwegian Constitution, and in the alternative, was improperly made without sufficient consideration of that Article.

Unfortunately for them, the Oslo District Court dismissed the case with costs. It found that the licensing decision did not breach Article 112, and that the decision had been made with sufficient consideration of its potential environmental impact. The Head of Greenpeace Norway, Truls Gulowsen, has indicated that the claimants may launch an appeal, but for the time being this is a big win for the government. Not only does the Oil and Gas sector make up 12% of its GDP, but the government itself owns a majority share in Statoil, one of the beneficiaries of the new licenses.

The judgment has not yet been translated. However, three key findings have been made clear in media briefings and through the interpretations proffered by Norwegian scholars:

(1) Norway is not responsible for the emissions caused by the use of its oil exports

There are two significant ways in which the oil industry contributes to climate change. First, carbon emissions are released in the process of extraction. Second, and far greater in extent, emissions are released when oil is burnt, for example in producing electricity or propelling a vehicle. Under the relevant international agreements, primarily the Kyoto Protocol and the Paris Agreement, emissions are attributed to the State in which they are released. Consequently, the use of Norway’s oil exports count towards the carbon emissions of the importing state which burns them; only the first kind of emission described above is allocated to Norway.The claimants had argued that for the purposes of Article 112, both kinds of emissions are relevant. They relied on this premise in contending that the licensing decision breached Article 112; it strengthened their claim that the licensing decision would generate enough emissions to breach Article 112. Perhaps unsurprisingly, given this approach runs counter to the way emissions are counted in the international arena, the court rejected this argument. Only the first kind of emissions fall under the scope of Article 112. Influenced by this finding, the Court found that, “[t]he risk for (traditional) environmental damage and climate deterioration as a consequence of that decision are limited.” (1)

(2) The limit of the courts in enforcing climate action or inaction

When private parties or governments are defendants in climate litigations they often argue that climate change is a non-justiciable matter; it is outside the remit of the courts because it is an inherently political issue. The Norwegian government followed suit. The courts delivered a mixed verdict. While the claimants were able to (ultimately unsuccessfully) invoke climate change considerations in their claim that Article 112 had been breached, certain aspects of their case were deemed off-limits by the judiciary. An example of this was the claimant’s contention that by allowing new areas of the Barents Sea to be exploited, the licensing decision would pave the way for other States to expand their oil exploration activities, potentially undermining the Paris Agreement. The means by which States will balance the generation of emissions with abatement and offsetting measures in order to fulfil their obligations under the Paris Agreement was deemed a political matter.

(3) Article 112 does confer justiciable individual rights

The parties offered conflicting interpretations of Article 112. While the claimants asserted that it conferred an individual right to citizens, enforceable in the courts, the government had contended that it merely sets out a non-binding aim for society to work towards. The differing interpretation arose because until this judgment there had been no explanation by the courts as to the nature of Article 112.The court found in favour of the claimants on this point, and this was their silver lining. While regretting the court’s overall verdict, the Head of Greenpeace Norway said: “we are pleased that the court has given a clear meaning to the Article on the environment … that [it] can be used to stop harmful political decisions.” Previously it was unclear when, if at all, a political decision would run afoul of Article 112. This is a common, and positive, outcome in climate litigation; the Grantham Institute at the London School of Economics has reported that in every two out of three climate-related disputes, climate laws have been strengthened or at the very least stayed the same.

Concluding thoughts

The claimants were facing an uphill battle from the start. Norway is a participant in the EU Emissions Trading System (EU ETS) in which it contributes to the gradual reduction of EEA and EU-wide emissions in industrial and aviation sectors. 97% of its electricity comes from renewable sources and through the use of offsets, it has committed to being carbon-neutral by 2030. In this context a single licensing decision, for which only the emissions resulting from extraction would be attributable to Norway under international carbon accounting methodologies, was unlikely to run afoul of any constitutional right to a healthy environment. The government could demonstrate that the emissions generated by the licensed activities were limited in their extent and would be countered by its overall strategy to meet its decarbonisation targets.

But like a game of whack-a-mole, once one climate lawsuit is dismissed several others others spring up. A number of Californian cities are demanding compensation from energy companies to minimise the impact of climate-induced weather events; the federal courts are set to hear the case of Juliana v United States in which 21 Orgeon-based youths are challenging the Trump administration for knowingly exacerbating climate change, and; UK-based NGO Plan B has begun the process of judicially reviewing the UK Government for not increasing the decarbonisation target enshrined in the Climate Change Act 2008 on the basis that it is incompatible with the UK’s commitments under the Paris Agreement. 2018 is set to be an exciting year for climate litigation.

(1)  Translation by Catherine Banet, Associate Professor in Petroleum and Energy Law at University of Oslo.

This piece has been co-authored by Vedantha Kumar.