The North Sea’s massive potential contribution to energy security, net zero, jobs and investment has topped the agenda at an industry and government summit.
The importance was underlined on the journey to Net Zero as The North Sea Transition Authority hosted Energy Minister Graham Stuart, the Scottish Government and leading industry representatives at the North Sea Transition Forum, which sets the strategic direction of the oil and gas sector.
Attendees at a meeting in Aberdeen discussed ways of supporting multi-billion pound projects which could support UK energy security and vital net zero projects, and safeguard tens of thousands of skilled jobs.
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Industry bosses also acknowledged the UK government’s move to put a price floor on the Energy Profits Levy to boost investor confidence and encourage investment in oil and gas projects and emissions reduction technologies.
The NSTA will also work with the government and industry on an upcoming review of the oil and gas fiscal regime, which is expected to give companies predictability, further supporting long-term investment, jobs and the UK’s security of supply.
Forum members heard that more than £200 billion could be spent on oil and gas, wind, carbon storage and hydrogen projects by 2030, a huge opportunity to reduce the UK’s reliance on energy imports as part of an orderly transition.
Many have a Humber focus, with two carbon capture and storage projects and several more offshore wind developments proposed. Lindsey Oil Refinery owner Prax has also just invested in a Shetland exploration operation, Hurricane Energy, while Easington continues to play a vital role in gas flow with potential for hydrogen storage, with Rough.
Stuart Payne, NSTA chief executive, said: “The North Sea remains the jewel in the crown of our country’s energy system. It provides abundant oil, gas, wind and hydrogen resources supported by a world-class supply chain which can integrate these assets, maximising their potential. This gives the UK a competitive advantage in the global race to secure investment for energy transition projects.
“Following this timely and productive conversation, I am confident that the NSTA, government and industry will find the right path, including through the fiscal review, to ensure that the UK seizes this opportunity to bolster its long-term energy security and accelerate to net zero.”
The NSTA is working with industry to progress more than 21 projects capable of producing 1.5 billion barrels of oil and gas, while awards from the 33rd oil and gas licensing round are expected later this year.
The forum was also used to provide updates on the delivery of the North Sea Transition Deal, agreed in March 2021 with the aim of supporting the oil and gas industry’s move to a net zero future and anchoring the expert supply chain in the UK.
Through the deal, industry committed to halving emissions from its operations by 2030 and spending £16 billion on carbon storage, hydrogen and platform electrification projects.
Strong early progress has been made, with emissions down 21.5 per cent between 2018 and 2021. Flaring was cut in half from 2018-22 – and was 7 per cent lower in the first quarter of 2023 than in Q1 2022.
Forum members also spoke about the need for swift action from government, industry and regulators, including on electrification, to ensure the 2030 emissions target is met. Industry also called for pace on the implementation of business models which would provide financial support for carbon storage projects.
Mr Stuart, Minister for Energy Security and Net Zero, said: “Oil and gas are essential to this country and will be for years to come as we transition to net zero.
“This forum was focused on cutting emissions from the oil and gas sector while supporting jobs, growing the economy and boosting our energy security – so we are not forced to rely on expensive foreign imports.”
