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The Government will announce its long-awaited decision on the future of a new gas drilling operation off the coast of Aberdeen on Wednesday, it is understood.
The Jackdaw gas field is widely expected to be approved by ministers following months of speculation about its future.
The North Sea project is one of two – alongside the Rosebank oil field – which the Labour Government must decide the fate of, after their approval by the previous Conservative administration was halted because of a legal challenge last year.
Prime Minister Andy Burnham has said he would “take a pragmatic approach when it comes to the North Sea” since coming to power in the summer.
He has faced pressure from environmental groups to “stick to the spirit of Labour’s manifesto commitment” and refuse consent for either of the schemes.
The 2024 manifesto committed to issuing no new oil and gas licences for the North Sea.
However, proponents of Jackdaw and Rosebank within the party have argued that neither are new fossil fuel fields, given the wheels were in motion to tap them ahead of Labour winning power.
Mr Burnham has also faced pressure from across the Atlantic to maximise oil and gas production from the North Sea.
Donald Trump has claimed the UK is “sitting on top of gold”, and has urged Mr Burnham to approve more drilling in the basin, as he did to former prime minister Sir Keir Starmer.
Energy Secretary Miatta Fahnbulleh has said a decision on Rosebank, the largest untapped oil field in the North Sea, will take “a bit longer” – suggesting it will be made separately from Jackdaw.
Andrew Bowie, the shadow energy secretary, said: “At last, Labour have had to be dragged kicking and screaming into approving Jackdaw. But nobody should mistake one gas field for a change of heart.
“Labour’s ban on new licences and punishing windfall tax are hammering North Sea investment and putting jobs at risk. MPs could soon have the chance to vote on ending the ban – they must take it.
“This should be the start, not the end. Labour must approve Rosebank, end the ban on licences, and scrap the Energy Profits Levy. That is what a Conservative Government would do, and it is what this Prime Minister should do if he wants anyone to believe he is serious.”