LONDON - Britain has reversed a decision to grant permission for an oil drilling operation and dropped its defence to a legal challenge over a disputed new coal mine, campaigners said on Thursday, after a landmark ruling on fossil fuel projects.

The move comes in response to a major judgment last month from Britain's highest court on the climate effects of fossil fuel projects, which activists said could profoundly impact new fossil fuel projects in Britain.

The Supreme Court ruled that planning authorities must consider the impact of burning, rather than just extracting, fossil fuels when deciding whether to approve projects.

Law firm Leigh Day said ministers in the former Conservative government had agreed to the quashing of a 2023 decision to permit oil drilling in Lincolnshire, in eastern England on July 4, the day of a national election in which the Conservatives were replaced in government by Labour.

Judge Judith Farbey said in a court order that the question of permission for the project would be remitted for a new decision to be made in light of the Supreme Court's judgment.

Mathilda Dennis – a campaigner with SOS Biscathorpe, which brought a legal challenge over the project – said in a statement that "it is clear that the unequivocal link between fossil fuel extraction and climate crisis can no longer be ignored".

Separately, environmental group Friends of the Earth said ministers had dropped the government's defence to a legal challenge over Britain's 2022 approval of its first new deep coal mine in decades.

The group said a court hearing in their legal challenge might still go ahead next week unless West Cumbria Mining, which wants to develop the coal mine, also dropped its defence.

The Ministry of Housing, Communities and Local Government referred a request for comment on the Lincolnshire oil project to the Planning Inspectorate, which declined to comment.

Egdon Resources, operator of the Lincolnshire oil project, and West Cumbria Mining did not immediately respond to a request for comment.