The incoming Prime Minister will also announce plans to bring energy companies under public control
Andy Burnham is set to announce plans for new North Sea oil and gas drilling when he enters Downing Street next week.
The Labour leader will turn his back on the 2024 manifesto, which had pledged not to issue new licences but to honour existing ones.
Proposals to issue more licences have been at the centre of a debate between Labour figures, with many arguing that expanding renewable energy will reduce the impact of climate change and guarantee energy security.
However, others have urged the party to take a more liberal approach to energy, warning the transition away from oil and gas must protect jobs and the cost of energy bills.
The incoming Prime Minister will also confirm plans to take water and energy companies under public control and a new council house-building programme, reports the BBC.
Back in September 2023, the then-Conservative Government approved Shell’s proposals to develop the Jackdaw gas field in 2022, and cleared Equinor and Ithaca Energy’s plans to drill in the Rosebank oil field.
However, environmental campaign groups Greenpeace and Uplift brought the challenge to the court over concerns about the impact on climate change.
In a judgement published in January 2025, Lord Ericht said the decision to grant consent was unlawful and ruled the consent should be "reduced" and reconsidered.
Energy Secretary Ed Miliband has been an outspoken supporter of Labour's 2024 manifesto position and previously described the licence issued to Rosebank as "climate vandalism".
However, Mr Burnham was presented with an open letter from trade unions and the oil and gas industry, calling on both him and Labour MPs to "back North Sea oil and gas".
The letter said backing the industry would send "a signal that the country remains committed to producing, building and manufacturing...It is a signal that government backs the people and places that have powered this country for generations".
Mr Burnham said he is still "finalising" his Cabinet after speculation in Westminster over his choice of Chancellor, with allies on Labour’s left favouring Mr Miliband.
However, reports suggest Home Secretary Shabana Mahmood will get the crucial role.
The incoming Prime Minister has also come under fire from Zack Polanski, with the Green Party leader accusing Mr Burnham of being "too in hock to vested interests to challenge the oil and gas companies profiting from climate change".
He told The Guardian: "Ultimately to help protect everyone in this country from the impacts of the climate and nature crisis, we need to end oil and gas drilling in the North Sea for good."
Environmental campaigner and fellow at the Green Alliance thinktank Chris Venables added: "Burnham has been very quiet about the climate [crisis] so far.
"I don’t think [it] is at the forefront of his mind, but that does not mean he will water down this agenda."
Linda Hobson, who chairs Unison’s Labour Link committee, said: "Andy Burnham has earned respect across the Labour movement, and often the political divide, for his achievements.
"Now it’s over to him to show he’s the right person to deliver the party’s promise of change when Labour won its landslide in 2024."
The centre-left Mainstream grouping of Labour MPs has called for him to appoint a “progressive Chancellor”.
In what appears to be a reference to Mr Miliband, the group urged the incoming Prime Minister to pick “someone who understands the threat that climate breakdown poses to people and planet and who has the courage to rebuild our state’s productive capacity".
