The Parliamentary Scottish Affairs Committee investigation has discovered that the gas and oil sector has come through a “significant and challenging turndown”. The investigation has revealed that technological development and additional funding is needed to exploit the remaining 10-20 billion barrels of oil and gas in the UK continental shelf. The state reports that, “it is also central to the UK’s energy security, with it being forecast that two-thirds of the UK’s primary energy needs will be met by oil and gas until at least 2035.”
Supporting Scotland’s Oil and Gas Sector
The committee heard from academics, industry bodies, unions, energy and climate change experts, professionals in decommissioning and regulators, and even the UK and Scottish Governments, over the inquiry. They agree that “the opportunities presented by an oil and gas sector deal for Scotland are too significant to be overlooked.”
The report found that with a well-supported sector deal, the British economy could generate £110 billion by 2035, with Scotland as a major beneficiary. The industry contributed £9.2 billion into the Scottish economy in 2017, supporting 135,000 jobs, according to the report. It said that the new technology could increase exploitation, as well as helping the industry in reducing its carbon footprint.
Making way for Progress
Scottish Affairs Committee chairman and SNP, Pete Wishart, said, “Scotland should be enormously proud of its globally recognised oil and gas industry. However, the industry is going through a period of immense change as it prepares for a challenging future and the Government urgently needs to step up and support the industry.”
“My committee’s report sets out a pathway for the future of the industry – a sector deal that would support the industry’s past, present and future. There is potentially another 30 years of oil and gas production in the North Sea but it’s important the sector uses this time to ensure the sector’s future as production starts to slow,” he continued. “To do this the Government needs to support the sector in exporting its skills and expertise around the world and to transfer the sector’s world leading engineering into other sectors, like renewable energy and carbon capture technology.
“Only by doing this can the Government ensure that in 30 years the north east of Scotland is still home to a world-class energy sector.”
Having Doubts
Richard Dixon, director of environmental campaign group Friends of the Earth Scotland, critiqued the report, saying, “This is an utterly complacent report which slavishly supports the oil and gas industry’s aim of getting every last drop of oil out of the North Sea while assuming that eye-wateringly expensive technology will save the industry from its own carbon emissions.”
“Climate change is an existential crisis for human civilisation and this report could have marked a turning point by acknowledging that we need to leave most of the fossil fuels we know about where they are. Instead it fully sanctions the industry to continue to fry the planet.”
He continued, “MPs and both the Scottish and UK governments continue to see no contradiction between the urgent need to reduce climate emissions and actively encouraging the industry to pump even more fossil fuels.”
Dixon urged an immediate halt to search for new oil and a plan to phase out existing production, with the aim of instead transferring workers to green energy jobs. He questioned the economic viability of carbon capture technology, saying it “will probably never happen on a large scale”.
A spokeswoman for the Department for Business, Energy and Industrial Strategy said, “Oil and gas remains one of the most productive and important sectors of the UK economy. We welcome this report and will consider the committee’s recommendations.”
Back in January, disagreements arose over the government’s £24 billion estimate for tax relief for decommissioning oil and gas infrastructure in the North Sea.
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