Rachel Reeves is trapped by her own rhetoric

Making speeches is the easy bit. Back in the real world, decisions come along to test the government’s “growth” agenda. Take the latest from the North Sea: a legal ruling bound to rattle investors, embolden environmental campaigners — not least over Heathrow’s third runway — and highlight another bit of economic doublethink from Labour.

A judge has revoked permission for two projects: Shell’s Jackdaw gas field, on which it has already spent an estimated £800 million; and the £3 billion Rosebank scheme, one of Britain’s largest untapped oil fields, being jointly developed by Norway’s Equinor and Ithaca Energy of the UK. They were respectively given the go-ahead in 2022 and 2023.

And before people lay into the judge with “enemies of the people” jibes, the decision was largely procedural. Lord Ericht, at the Court of Session in Edinburgh, had no option but to take into account a UK Supreme Court ruling from June last year. It had found Surrey county council’s approval of a piddly Horse Hill onshore drilling project to have been unlawful. How come? Because it had failed to evaluate “scope 3” emissions — those generated by consumers using energy products — in its environmental impact assessments.

• Court ruling casts doubt on future of Rosebank oil field

Neither had the then Tory government nor the North Sea regulator considered them before nodding through Jackdaw or Rosebank. So when Greenpeace and Uplift brought a legal challenge, which the Labour government didn’t even oppose, the judge’s verdict was not the greatest shock. The companies argued that they should be allowed to press on anyway. Yet, the judge was clear: “The public interest in authorities acting lawfully and the private interest of members of the public in climate change outweigh the private interest of the developers.”

The upshot? The companies need to get consent again. And, while you’d expect them to succeed, the episode may once again show up the cabinet splits between the energy secretary Ed Miliband and Rachel “growth trumps net zero” Reeves.

Thanks to Shell’s North Sea joint venture with Equinor, the Shell boss Wael Sawan is central to both projects. His view? “We would hope that the government leans in and supports us building this crucial piece of UK infrastructure.” Jackdaw alone, he says, would provide fuel to heat 1.4 million homes. And with gas still making up around “a third of Britain’s energy mix”, the choice is between “importing it or taking it from the UK”.

The companies must now wait for new environmental impact guidelines, before submitting a fresh statement on their two schemes for review by Miliband’s department. After that, the North Sea Transition Authority will take another look at their “field development plans”. So, whatever happens, there’ll be a delay, even if Sawan is pleased the court did not order the companies to stop work while they wait — just not extract oil or gas.

Anything but renewed approval risks being a disastrous own goal. Sawan is calling for “predictable regulation” in the UK and a “stable investment climate”. And there’s a chance an adverse decision would prove the trigger for him to relocate one of Britain’s biggest companies to America. But the episode also shows up Labour’s incoherent stance on the North Sea, with its manifesto pledge not to block existing projects but to refuse new exploration licences. If re-approving old licences brings energy security and growth, why doesn’t new fields?

Fever dream

Not many UK companies bring real fizz to America. Most of them go alarmingly flat, before beating a hasty retreat. So it says something for Fevertree’s co-founder boss Tim Warrillow that from a standing start in 2008, he now has the No 1 tonic and ginger beer brand in the US — despite taking on rivals like Schweppes.

Last year America made up 35 per cent of Fevertree’s £368 million sales: no mean feat from a chap who temporarily “dragged” his family there 17 years ago and was “daunted by the task ahead”. Yet, even he knew there was only so much the Aim-listed outfit could do by itself.

• Fevertree sells stake to Molson Coors in push to expand in US

Hence his “transformational deal”, as Panmure Liberum put it. He’s struck a US partnership deal with Molson Coors. It’s founded on the American brewer taking an 8.5 per cent stake in Fevertree, paying £71 million at 654.2p a share: dilution the soft drinks group will mitigate with a share buyback.

Molson, best known for its Coors Lite and Miller Lite beers, will take operational control of Fevertree’s US wing and plug it into its vast distribution network, strong in both stores and bars. There’ll be a “step change” in marketing spend plus local production, though Fevertree will keep the intellectual property, ensuring no dilution to taste.

In return, on top of a one-off $23.9 million, Fevertree will get a profit share, with a guaranteed minimum between 2026 and 2030. True, the details were a bit sketchy but, after a rocky period, the shares bubbled up 20 per cent to 791p. Jefferies analysts forecast a doubling of operating profits to £77 million by 2028. Could Molson swallow all of Fevertree one day? Warrillow insists that has “absolutely not” been discussed. But who knows where his American dream will end.

Cheque in the post

Just the thing to make a Czech bounce: a gift from Ofcom to Daniel Kretinsky, who’s buying the Royal Mail-owner International Distribution Services for £3.6 billion. By cutting the second-class service, the regulator thinks Royal Mail could save between “£250 million and £425 million” a year. Capitalise that on a lowly five times and it’s worth up to £2.1 billion to Kretinsky. If Ofcom had acted earlier, IDS might have seen him off.