Asked by Lord Bruce of Bennachie To ask Her Majesty’s
Government what steps they will take to promote new exploration and
enhanced recovery of oil and gas from the United Kingdom’s
continental shelf. The Parliamentary Under-Secretary of State,
Department for Business, Energy and Industrial Strategy (Lord
Henley) (Con) My Lords, the Maximising...Request free trial
Asked by
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Lord Bruce of Bennachie
To ask Her Majesty’s Government what steps they will take
to promote new exploration and enhanced recovery of oil and
gas from the United Kingdom’s continental shelf.
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The Parliamentary Under-Secretary of State, Department for
Business, Energy and Industrial Strategy (Lord Henley)
(Con)
My Lords, the Maximising Economic Recovery of UK Petroleum
strategy sets out the steps that the industry and the Oil
and Gas Authority must take to secure that the maximum
value of economically recoverable oil and gas is recovered
from the strata beneath UK waters. Most recently, the
Government have provided £45 million for seismic surveys in
underdeveloped areas, and data from those will support the
forthcoming 31st offshore licensing round.
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Lord Bruce of Bennachie (LD)
I thank the Minister for that reply. As noble Lords will be
aware, the industry has had a pretty traumatic two or three
years, but nevertheless it accounts for hundreds of
thousands of jobs and billions of pounds of benefit to the
balance of payments. However, not enough exploration,
development and enhanced recovery investment is taking
place. Will the Government ensure that there are sufficient
incentives, not subsidies, to make this happen rather than
just encourage it to do so? We should recognise that if we
do not look, we do not find, and we cannot produce.
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I agree with the noble Lord that the industry has had a
pretty traumatic time but I think things are picking up. As
he said, this is very important for energy security, jobs,
the economy and—dare I say it—the Exchequer. As I said in
my original Answer, we are providing funds for seismic
surveys to help in the next round. As the noble Lord will
be aware, some 61 companies got licences in the previous
round, with the potential to produce some 320 barrels of
oil equivalent. I hope something similar or better will
come from the next round.
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(Lab)
My Lords, the Minister will be aware that oil and gas
platforms on the continental shelf, undersea cables and
fisheries are all part of what was once called the
“offshore tapestry”, with a small fleet of ships to look
after that tapestry. We no longer have that; post Brexit,
there may be some issues. Does the Minister not believe
that we should perhaps look at investing in more ships to
look after that highly valuable offshore tapestry?
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The noble Lord makes a very important point, which I will
certainly pass on to my colleagues in other departments.
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(LD)
My Lords, I draw attention to my interests in the register;
I am a vice-chairman of the All-Party Parliamentary Group
on the British Offshore Oil and Gas Industry. Does the
Minister agree that one way to enhance the recovery of oil
and gas from the United Kingdom continental shelf, increase
tax revenues and create valuable jobs in the industry—which
has lost 150,000 jobs since 2014—would be to focus simply
on extended production of late-life fields and promote
early development of known proven resources?
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The noble Lord is correct: we should do that. As his noble
friend said, we should also continue with explorations.
There is much that we can do, that the Government are doing
and that the industry is doing.
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(GP)
My Lords, is the Minister aware of the carbon bubble—the
possibility that the bottom could fall out of the market in
oil and gas and general fossil fuel investment? Will the
Government therefore give some advice on these risks to
anyone who would like to look further at oil and gas? I
raised this with the Bank of England a few years ago and it
has since said some quite enlightened things.
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The noble Baroness makes a point but it is important that
we continue to look at all available resources. The noble
Baroness knows we are moving towards a low-carbon economy
but we also want a balanced energy mix. It is important
that we make use in the medium—and possibly long—term of
the fossil fuels that we have.
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(Lab)
My Lords, who is responsible for removing the redundant
platforms in the North Sea and elsewhere? I believe they
are all privately owned. What happens if the company no
longer exists? Who is responsible for putting the seabed
and everything else back to what it was originally?
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As I understand it, although I will no doubt have to write in
greater detail to the noble Lord, removing the platforms is a
matter for those who put them in place. When we talk about
jobs and available exploration jobs, it is worth pointing out
that there will be jobs in decommissioning and removing those
platforms in due course, which will make use of the expertise
in north-eastern Scotland that put the platforms in and
operated them.
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(CB)
My Lords, what is the Government’s estimate of the length of
time for which we can continue to burn fossil fuels while
meeting our legally binding carbon reduction commitments, as
agreed up to the fifth carbon budget and beyond?
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I am not sure I can give the noble Lord those figures but I
can assure him that there are opportunities to continue to
meet our obligations in that respect, particularly by making
use of shale gas exploration if we move onshore. We certainly
reckon that current production represents some 65 % of UK oil
demand and 50% of UK gas demand, but there is much more to be
found.
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(CB)
My Lords, can the Minister explain what plans there might be
to exploit the continental shelf around the Falkland Islands
and whether there are any issues relating to the legal
position of that shelf?
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The noble Baroness is moving on to a different continental
shelf and rather a different question —one that I do not
think I am qualified to answer at this stage. I will no doubt
be prepared to write to the noble Baroness.
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