The Sixth Report by the Scottish Affairs Committee on the future
of the oil and gas industry was debated in Westminster Hall
today.
The Committee's chairman, MP (Perth and North
Perthshire, Scottish National Party), explained the report had
been compiled due to the “unprecedented uncertainty at the end of
the decade” over the future of the industry, and the transition
to de-carbonisation, which is believed to be essential for the
future success of the industry.
After six evidence sessions and thirty written submissions, it
was concluded by the committee that the sector was in “a
reasonably good place” and had achieved “a sustainable recovery
in workforce.” It was noted that a decarbonisation future was an
“opportunity to be grabbed for Scotland”, while also considering
that the whole of the UK depended on the Scottish oil and gas
industry as a source of employment.
In order for the industry to thrive in future years, however, the
UK government needed to agree on an “ambitious sector deal” that
would boost the economy of North East Scotland via a long term
plan. Such a deal would need to “capitalise on decommissioning
opportunities in North Sea Oil and would need to find ways of
transferring expertise to maximise the economy prospects for the
sector.” It was noted that the committee had been struck by the
importance of carbon capture technology, which the UK government
helpfully sees as an industrial strategy.
Mr Wishard acknowledged that the report had received a mixed
reaction from environmental groups (specifically, Friends of the
Earth). However, the committee responded that such groups had “no
true examination of what we are offering” and dismissed this as a
threat to their strategy.
(Con) stated that leading
companies were taking the initiative in tackling climate change
(for instance, BP, EMI and Shell), and added they were being
joined by leading US companies in securing a lower carbon future
via decommissioning opportunities.
(Lab) commented that a
potential sector deal could bring in £110 billion until 2035, and
added that leading unions played a crucial role in the industry,
and therefore needed to be considered if economic recovery of the
oil and gas industry was to be maximised.
(Con) argued that West
Africa, South America, and the Gulf of Mexico had benefitted from
the UK's expertise, and insisted that there were global
opportunities for Aberdeen to have an “international outlook”,
placing the city at the centre of the market with vast export
potentials to boost economic growth.
(SNP) stated that along with
a sector deal there needed to be a “parallel plan” for the future
of renewals, though she did not have confidence in the UK
government to issue this given their “broken promises” of the
past. She asserted, however, that the government needed to agree
a vision with the industry.
(SNP) spoke of the
impressive range of support that Scotland had offered the
industry. For instance, a £12 million training fund in 2016, and
the offer of £90 million over the next decade from the SNP to
support the industry further. While the UK government needed to
“step up to the plate”, he also acknowledged they should follow
the path of Norway by saving and investing in the future, rather
than their current approach of “spend, spend, spend.”
, Minister for Business
and Industry, who is responsible for sector deals, took the view
that oil companies were “market takers rather than market
makers.” He said the government was funding research and
development in the oil and gas industry, and confirmed that the
committee’s report showed there was potential for the industry to
grow. He concluded that "an ambitious sector deal should be
agreed”, adding: “I hope the government is on top of it.”
