2023-05-29 16:13:21
DAccording to a media report, the opposition Labor Party is considering a ban on new oil and gas drilling in the British North Sea. According to a report by The Times, party leader Keir Starmer wants to stop the exploitation of new production sites and invest more in renewable energies if he wins the election next year. In Scotland in particular, the oil and gas production industry is an important employer.
Energy Secretary Grant Shapps of the ruling Conservative Tory government on Monday accused Labor of an “ideological feud” against the oil industry. In his words, the government, on the other hand, is acting pragmatically by issuing new drilling licenses. The responsible authority, the North Sea Transition Authority (NSTA), received 115 bids from 76 companies in the current auction round for new production licenses. However, some companies such as Harbor Energy complain that the high special profit tax makes investments in British exploration unattractive.
Expansion of renewables should create half a million jobs
Britain’s gas industry produces about 45 per cent of the UK’s consumption in the North Sea, with oil production covering a smaller proportion of consumption. Companies such as BP, Shell, Harbor Energy, Norway’s Equinor and others directly employ around 20,000 people to extract fossil fuels from British waters. Together with suppliers and the equipment and engineering industry, the sector accounts for an estimated 200,000 jobs, more than half of them in Scotland.
According to the Sunday Times, Labor leader Starmer plans to announce a green transition in a keynote address on energy policy in June. According to the party, the expansion of renewables should create half a million jobs. The governing Scottish National Party (SNP) in Edinburgh has also spoken out against the expansion of new oil and gas production. Regional Prime Minister Humza Yousaf spoke of a “moral imperative”. Paul de Leeuw, director of the Energy Transition Institute at Robert Gordon University in Aberdeen, called Starmer’s plans to halt new exploration and promise new jobs “rather naïve”. Even the announcement will undermine investor confidence.
Dispute over the Rosebank oil and gas field in the North Atlantic
Production in the British North Sea has been declining for years. Oil and gas production has fallen by two-thirds from its 1999 peak and is now at about 1.5 million barrels a day. Oil production has fallen by a good quarter in the past five years. Without new major exploration, it would drop drastically over the next decade. Currently, licenses have been granted for the large Combo and Jackdaw oil fields.
The Rosebank oil and gas field in the North Atlantic, west of the Shetland Islands, is particularly controversial. Up to 500,000 barrels of oil could be produced there. Environmental and climate groups want to prevent the government in London from giving the Norwegian Equinor group permission to develop Rosebank. The UK has made a legal commitment to reach net-zero emissions by 2050. However, some experts see potential advantages in domestic oil and gas production, which reduces CO2-Emissions caused when importing oil and gas from other countries. This is also the argument of the regulatory authority NSTA.
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