North Sea gas ramped up in wake of Ukraine War
Production increases as fears grow over energy security
NORTH Sea gas production is being ramped up amid global fears over energy security in the wake of the war in Ukraine, The Herald can reveal.
Five new fields have already started producing in recent weeks, while four more will come online in the coming months.
In addition the massive Glendronach gas field off Shetland has been given the go ahead and will begin production in 2024, while another,
Glengorm, could start operating in 2027. Consideration is also being given to a further major field, Jackdaw.
The dramatic development comes amid international efforts to diversify gas supplies away from Russian sources, which have been used to fund Vladimir Putin’s invasion of Ukraine.
As the war continues into its third week, Chelsea FC owner Roman Abramovich was yesterday sanctioned for his links to the Russian president as the UK targeted a fresh round of oligarchs accused of having the “blood of the Ukrainian people... on their hands”. Branded a pro-kremlin oligarch, Mr Abramovich was hit with an asset freeze and a travel ban yesterday after ministers came under sustained pressure to target him over Moscow’s ongoing invasion of Ukraine.
The updated sanctions list, which includes seven new elite individuals, said Mr Abramovich has had a “close relationship for decades” with Mr Putin, which the football club owner has previously denied.
Earlier this week the European Union – which relies on Russia for 40 per cent of its gas consumption – announced it would reduce its demand for Russian gas imports by two-thirds this year and end its dependence in total “before the end of the decade”.
On the same day the US and the UK – which rely considerably less on Russian oil and gas than the EU – announced they too were ending Russian imports.
The developments have intensified growing debates about how to fill the energy gap.
Governments across the EU, the UK and Scotland all plan to step up renewable energy resources. However currently green sources do not provide enough power to industry or to
householders – with 80% of Scottish homes reliant on gas central heating.
A spokesman for the North Sea regulator, the UK Oil and Gas Authority, said 28 fields had been given approval in principle, including 13 at the final stage of pre-production known as the Field Development Plan.
He added: “There are more projects in the UK continental shelf at a lesser stage of maturity which will likely come forward in 2023 and later years for concept selection and field development plan gates.”
He added that five new gas fields, Arran, Finlaggan and Columbus, Buzzard Phase 2 and Breagh Phase 2, have come online so far in 2022 with a further four oil and gas fields expected to start production later this year.
The Scottish Government, which earlier this week called on UK ministers to help usher in the “fastest possible managed and just transition away from dependence on oil and gas”, was furious.
A spokesman urged UK ministers to review the granting of the new licences.
“The Scottish Government’s position is clear, that unlimited extraction of fossil fuels is not consistent with our climate obligations and we call again on the UK Government, who have the power to act in this instance, to urgently re-assess all approved oil licences where drilling has not yet commenced against our climate commitments,”he said.
“Our position has been supported by the UK and Scottish Government’s statutory advisers on climate change, the Committee on Climate Change, who agreed that any effective and credible checkpoint must extend beyond new licensing rounds to also cover those fields that have already been consented but are not yet in production – such as Cambo.”
The spokesman went on to say ministers are investing heavily in an economic move away from fossil fuels to green energy with substantial resources being devoted to helping people working in the North Sea industry to train and find jobs in the renewable sector.
Scottish Conservative energy spokesman Liam Kerr welcomed the new gas fields.
He said: “The appalling acts committed by Vladimir Putin should have convinced the Scottish Government to support efforts to secure Scotland’s energy supply.
“But Nicola Sturgeon, backed by her extremist Scottish Green colleagues, fail to acknowledge this new reality and continues to refuse to back Scotland’s oil and gas sector.
“Scotland should increase oil and gas production to meet our domestic needs, and to allow us to export to countries who are currently reliant on Russian gas. Not only would this hinder Putin’s war effort, it would support Scottish jobs as we transition safely and gradually away from oil and gas.”
Last year the UK met about 40% of its gas demand from domestic production. Some 4% comes from Russia with around half imported from Norway and the remainder from Qatar.
UK Business and Energy Secretary Kwasi Kwarteng told MPS on Wednesday that “demand can be met by alternative sources of supply” and announced a taskforce in coalition with other western nations will be set up to draw up a global strategy for maintaining supplies of fuel.
He acknowledged the UK does not depend on Russia for its gas supply, with only 4% made up from imports from Putin’s government. But he confirmed he “will be exploring options to end this altogether”.
He added: “We fully intend and we must end our dependency on all Russian hydrocarbons. In the meantime, we need more investment in North Sea oil and gas production as we make the move to cheaper and cleaner power.
“Turning off domestic production as some are calling for at this moment would be completely the wrong thing to do and we’re not going to do it.”
Responding to Mr Kwarteng, SNP energy spokesman Stephen Flynn, warned “we cannot escape the sheer scale of what has been announced here” and underlined the role of North Sea oil and gas reserves.
A UK Government spokesman said: “The UK has no issues with either gas
We call on UK ministers to urgently reassess approved licences where drilling has not commenced
or oil supply. In addition to domestically produced energy, the UK has access to diverse and flexible sources of both gas and oil, and we remain confident energy security will be maintained.
“There will continue to be ongoing demand for oil and gas over the coming decades while we transition to low carbon energy. In the meantime, we will continue to back North Sea oil and gas production for security of supply during this transition.”
A UK Government source told The Herald: “We understand from industry sources that both Glengorm and Glendronach are pre-final Investment Decision (FID) discoveries. Glendronach is expected to reach FID in April with first production by 2024. Glengorm is expected to go to FID in 2024 with start-up in 2027. This discovery is under appraisal so is considered by to be a contingent resource.”
The source added proposals to develop the Jackdaw field are currently under consideration.
Industry figures last year found 71,500 people were employed either directly or indirectly in the North Sea industry and that it was responsible for 12% of total Scottish GDP.