The Government today announced it will review its policy on
the future UK offshore oil and gas licensing regime as part
of the wider aim of achieving net zero emissions by 2050.
The review will ensure the Government has the information
needed to plan for future oil and gas production in the UK,
in a way that is aligned with tackling climate change.
Initial findings and next steps to be published in the
upcoming Energy White Paper.
Over half of the UK’s electricity comes from clean sources
including wind and solar energy. However, oil and natural
gas are still required for heating, cooking and transport,
and vital to the production of many everyday essentials
like medicines, plastics, cosmetics and household
appliances. This is likely to remain the case over the
coming decades as the UK transitions to low carbon
solutions.
The independent Committee on Climate Change has recognised
the ongoing demand for oil and natural gas, including it in
all scenarios it proposed for how the UK meets its target
for achieving net zero emissions by 2050.
The oil and gas sector supports 270,000 jobs across the UK
and plays a key role in developing the infrastructure and
capability for green technologies such as carbon capture
and storage and hydrogen power. The oil and gas sector is
also a major source of tax revenue for public services and
has provided over £330 billion to the UK Government from
production taxation alone in today’s prices.
The review comes as the Oil and Gas Authority announces the
outcome of the 32nd licensing round for North Sea
exploration. This is important for the country’s ongoing
energy security and economy, while ensuring that
much-needed supplies are maintained even as the UK cuts
carbon emissions.
Business and Energy Secretary said:
Over half of our electricity now comes from low-carbon
sources, power from coal is at an all-time low, and we
have more installed offshore wind capacity than any other
country in the world.
While we have decarbonised our economy faster than any
other major country over the past two decades, the oil
and gas sector will continue to be needed for the
foreseeable future as we move toward net zero carbon
emissions by 2050.
Our review into future oil and gas licensing rounds will
ensure we are able to meet our net zero target, while
protecting jobs across the country as part of our plan to
build back better with a greener, cleaner economy.
The review is in keeping with the future direction of the
Government’s regulation of oil and gas in the UK.
The Oil and Gas Authority is currently reviewing its core
strategy to ensure that it can assist in working with
industry to support the UK’s climate change goals.
Alongside this, the upcoming North Sea Transition Deal will
be published within this Parliament, and will also set out
more details later this year of how Government plans to
work with the sector and key stakeholders to achieve the
aim of supporting a transition to low carbon energy
sources, while getting the benefit from the limited
reserves in the North Sea and protecting highly skilled
jobs.
