23 Apr
Question
North Sea Oil and Gas Licences: Economic Growth

The Parliamentary question session centered on the issue of North Sea oil and gas licences and their impact on economic growth, specifically in Scotland. The debate highlighted opinions on the future of oil and gas, their role in the UK's energy strategy, and the transition towards cleaner energy solutions.

During the session, Ian Murray stressed the existing contributions of North Sea workers, pointing out the diverse energy mix needed to meet national targets, combining renewable, nuclear, and fossil-fuel energy sources. He implied governmental support for a gradual transition in the energy sector, encouraging investments in both traditional and emerging technologies, like hydrogen.

14 billion barrels

Projected annual oil and gas consumption by 2050 despite net-zero targets.

Sir Ashley Fox and Harriet Cross, both from the Conservative party, raised concerns about potentially negative economic implications of ceasing new oil and gas licences, emphasizing the need for domestic energy production to maintain energy security and economic vitality in the region.

4 billion barrels

Current domestic production capacity.

Labour members, including Tracy Gilbert and Gregor Poynton, advocated for a balance, emphasizing jobs and the strategic importance of clean energy transition endeavors, supporting investments in renewables and innovative projects like hydrogen, signaling optimism for job creation through diversification.

£12 billion

Potential Treasury income from continued North Sea operations.

£150 billion

Estimated economic growth from North Sea energy production until 2050.

Outcome

The outcome of this question session was a reinforcement of the UK government's commitment to balancing current reliance on oil and gas with future aspirations for cleaner energy. The discourse reinforced the importance of strategic investment to ensure energy security while addressing economic and employment concerns in Scotland and the wider UK.

Key Contributions

Sir Ashley FoxMP
Conservative

Inquired about the economic implications of not issuing new licences.

Harriet CrossMP
Conservative

Cited an Offshore Energies UK report advocating for the continuing use of the UK's oil and gas resources.

Ian Murray

Acknowledged the central role of North Sea workers and the existing energy mix.

Tracy GilbertMP
Labour

Discussed the transformation of a local port for renewable energy investments.

Gregor PoyntonMP
Labour

Raised the importance of investing in new technologies like hydrogen for a just transition.

Original Transcript
Sir Ashley Fox
Bridgwater
Con
Question
UIN: 903743

4. What assessment he has made of the potential impact of not issuing new North sea oil and gas licences on levels of economic growth in Scotland.

Harriet Cross
Gordon and Buchan
Con
Question
UIN: 903754

15. What assessment he has made of the potential impact of not issuing new North sea oil and gas licences on levels of economic growth in Scotland.

The Secretary of State for Scotland
Ian Murray
11:49

I am proud of the enormous contribution North sea workers have made to our country. Oil and gas will be an important part of our energy mix for decades to come.

We have a workforce who lead the world, and we are determined to secure their long-term future in the energy industry, including oil and gas.

The UK Government will soon respond to our recent consultation on supporting the energy transition in the North sea, and I am in the north-east tomorrow, turning on a wind farm and also meeting leaders in the oil and gas sector.

Sir Ashley Fox
11:49

If the UK achieves net zero in 2050, we will still consume about 14 billion barrels of oil and gas a year. We are currently on track to produce 4 billion barrels a year. Will the Secretary of State explain why he prefers to import our energy, rather than produce it ourselves?

Ian Murray
11:49

The national mission of this Labour Government is to get to clean power by 2030, but that means three things: renewable power, nuclear power, and oil and gas. As I have said already, oil and gas will be with us in the Scottish and UK context for decades to come.

Harriet Cross
11:49

A recent report by Offshore Energies UK showed that if the UK oil and gas basin continued to be used until 2050, it could produce half our oil and gas needs.

That would do wonders for jobs in the north-east of Scotland, the north-east economy, our energy security and the energy transition, and it would also bring in £12 billion to the Treasury.

On top of that, it would bring in £150 billion of economic growth to the UK, which I am sure everyone in this House and the Government would welcome.

Will the Secretary of State please have a word with the Energy Secretary and ask him to stop his policies, which are continuing to ruin our oil and gas sector, and for once back north-east Scotland?

Ian Murray
11:49

On the oil and gas sector in 2050, I have already mentioned at the Dispatch Box, as has the Secretary of State for Energy Security and Net Zero, that oil and gas will be with us for decades to come, including to 2050.

Tracy Gilbert
Edinburgh North and Leith
Lab
11:49

Does my right hon. Friend agree that there is an opportunity for significant economic growth in Scotland from getting right a just transition from oil and gas to clean power?

In my constituency, the landing space at the port of Leith previously used by the oil and gas sector has been transformed by investment from Forth Ports into the largest renewable hub in Scotland.

Will he join me in welcoming this investment in Leith, and will he outline how his Department will help secure every job possible in the transition from oil and gas?

Ian Murray
11:49

I commend my hon. Friend on the work she is doing, particularly in the port of Leith, to ensure that we can have the transition and have it well.

She highlights the important thing about this issue and debate: the energy mix requires us to have renewable power and clean energy by 2030, but it also requires us to have nuclear power and oil and gas. The energy mix means that we do it all; it is not either/or.

Gregor Poynton
Livingston
Lab
11:49

The Secretary of State rightly outlines how important the oil and gas sector is to Scotland, and to the workers and businesses that rely on it, but if we are to have a truly just transition, we need to invest in new technologies such as hydrogen.

Will he, therefore, join me in welcoming the shortlisting of the Selms Muir hydrogen project in Livingston for UK Government support, and outline how that will benefit my constituency?

Ian Murray

On 7 April, the UK Government announced that eight Scottish projects had been shortlisted for the next stage of the hydrogen allocation round 2 process. My ministerial colleagues and I look forward to working with industry to deliver our vision for a thriving low-carbon, hydrogen economy in the UK.

I commend my hon. Friend on the work he has done in pushing forward the project in his constituency.

Mr Speaker
11:55

I call the shadow Secretary of State.

Andrew Bowie
West Aberdeenshire and Kincardine
Con
11:55

Does the Secretary of State agree with the Scottish Labour leader, who says there is no question but that there has to be new oil and gas, or does he agree with his colleague the Energy Secretary, who has banned new licences in the North sea and is overseeing the accelerating decline of the UK’s oil and gas basin?

Ian Murray
11:55

The Energy Secretary and his Department are involved in a consultation on the just transition at the moment, but I go back to my earlier answers: if we are to get clean power by 2030 and to have an energy mix in this country, we require oil and gas, we require renewables and we require nuclear.

It is a simple process.

Andrew Bowie

I think we all heard that, and I am sure Anas Sarwar did. The Secretary of State was unable to agree with his own leader in Scotland, and is so in hock to the UK Labour party that he cannot stand up for Scottish workers or the Scottish oil and gas industry.

It has always been the party interest over the national interest for Labour, with no notice taken of the Scottish Labour party. Ten years ago, the Scottish Labour party was described by its own leader as being simply the “branch office”. Nothing has changed, has it?

Ian Murray

The Government’s sole purpose initially, in their first few months in office, was to clear up the mess that the hon. Gentleman’s party left in this country, including the £22 billion black hole. We will get on with delivering our missions, including clean power by 2030.

That is what we are focused on, because that is what is good for jobs, good for bills and good for the environment.

All content derived from official parliamentary records