The Press and Journal (Aberdeen and Aberdeenshire)
No new investment in oil & gas: Labour
ALabour government would block fresh investment in North Sea oil and gas, its leader has confirmed.
“What we’ve said about oil and gas is there does need to be a transition,” Keir Starmer told a panel at the World Economic Forum in Davos.
“Obviously, it will play its part during that transition, but not new investment, not new fields up in the North Sea, because we need to go towards net-zero, we need to ensure that renewable energy is where we go next.”
His comments have drawn criticism from industry chiefs, who have accused the Labour leader of failing to properly engage with the sector.
Sir Keir’s comments come hot on the heels of the Scottish Government’s energy strategy, which declared a presumption against further North Sea exploration.
While energy policy is reserved by Westminster, meaning the stance is largely symbolic, concerns have been raised about the
knock-on impact on investor confidence.
That has already been severely dented by the UK Government’s doubling down on its windfall tax on North Sea producers.
Just this week oil giant Harbour Energy confirmed plans for job cuts, with the company blaming the controversial energy profits levy.
In the first poll of 2023, Labour extended its lead over the Tories to 20 points, consolidating an already substantial lead. The next UK general election must be held by January 24 2025 at the latest.
Jenny Stanning, trade body Offshore Energies UK’s (OEUK) external relations director, warned Sir Keir that “words have consequences”, and invited him to engage with industry.
She said: “Keir Starmer’s suggestion today, at Davos, that there should be no further investment in North Sea oil and gas, will be deeply upsetting to the many workers and communities dedicated to providing the UK with energy. It will also further damage investor confidence.
“Those communities, whether in the north-east of Scotland, or England’s energy coast, from Norfolk to the Scottish Borders, have been central to the UK’s energy security for five decades – and especially in last year’s energy crisis.
“We all know that the UK must transition to lowcarbon energies as fast as possible. Our industry has pledged to work with the UK’s governments to reach net-zero by 2050. But, in the three decades till then, we will need gas and oil.
“About 24 million homes (85% of the total) rely on gas boilers for heat and we get 42% of our electricity from gas. We also have 32 million vehicles running on petrol and diesel. So, we need gas and oil.”
Aside from taking aim at oil and gas, Sir Keir called for the creation of a “clean power alliance” to reduce the influence of the world’s biggest fossil fuel cartel, Opec.
In his view, an “inverse Opec” would involve countries sharing “net-zero share information”, cooperating and allotting investment, “with a view to driving the global prices down”.
But while praising his support for green energy, Ryan Crighton, policy director at Aberdeen and Grampian Chamber of Commerce, said he finds it “very hard to understand how Labour can form an energy policy given how little I know it has engaged with the industry”.
He added: “The ‘energy transition’ is going to take 25 years or more and there is quite clearly a sustained period of time where oil and gas will remain a crucial part of our energy mix.”