The Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) in the UK has reportedly refused to approve Royal Dutch Shell ‘s Jackdaw gas field development plans in the North Sea.

According to a Reuters report, the British regulator declined to approve the environmental statement for the development.

However, it is not immediately clear why OPRED rejected the statement. The rejection comes despite a recent increase in natural gas and oil prices in several European countries, including the UK, due to a shortage in supplies.

A Shell spokesperson told the news agency: “We’re disappointed by the decision and are considering the implications.”

The UK Government’s Department for Business, Energy & Industrial Strategy (BEIS), of which OPRED is a part, did not respond to Reuters’ queries.

Jackdaw field was discovered by Shell affiliate Bg International in 2005. It is proposed to be developed at a water depth of around 256ft in blocks 30/02a, 30/02d and 30/03a of the UK central North Sea.

The environmental statement for the field development was submitted in January 2020. However, the timeline was affected by the Covid-19 pandemic.

Under the original plan, Jackdaw field was expected to produce its first hydrocarbons in 2024. The field is operated by Shell.

In July, Shell reported a net income of $3.4bn for the second quarter of 2021. In the same period a year ago, the company incurred a loss of $18.13bn.

Last month, the oil major agreed to divest its assets in the US Permian Basin to ConocoPhillips for $9.5bn.