Offshore Petroleum Licensing Bill

Douglas Ross Excerpts

2nd reading
Monday 22nd January 2024 Commons Chamber

[Edward Miliband]

My hon. Friend is absolutely right. She takes me to the fifth and final bad argument that the Government are making for the Bill.

[Douglas Ross (Moray) (Con)]

Will the right hon. Member give way?

[Edward Miliband]

In a moment.

The Government argue that the Bill can somehow be justified on climate grounds, which demands a level of absurdity that should make even them deeply embarrassed. Let us get this straight. We signed a global agreement at COP28 for a transition away from fossil fuels in line with the science. That science is unequivocal: we must leave the majority of fossil fuels in the ground. But at home, their domestic policy is what they call “maxing out” the North sea.

Let us get this clear: in the crucial coming two years, Ministers will travel around the world to try to turn that COP28 agreement into reality, but how will the conversation go? The UK Minister will say to other countries, “We want you to leave your fossil fuels in the ground, because that is the agreement from COP28.” The country we are trying to persuade will say to us, “Hang on a minute. You’re saying we should leave our fossil fuels in the ground, but you’re planning to extract all yours.” What will we say, other than, “Yes, the Government are practising total hypocrisy, but please do as we say, not as we do.” That is the truth. The science is unequivocal.

[Douglas Ross]

I was hoping to intervene when the right hon. Gentleman was talking about jobs and investment, because he quoted an awful lot of people. Why did he not quote Sir Ian Wood, who said that Labour’s plans for the North sea oil and gas industry would

“place in jeopardy tens of thousands of jobs”.

David Whitehouse, the chief executive of Offshore Energy UK, said that Labour’s plans would “create a cliff edge”, deterring investment and heightening our risk of energy shortages. Why did he not mention those people?

[Edward Miliband]

I am very happy to talk about Ian Wood. We had a good roundtable with him in Aberdeen in November. I totally accept that it is for a Government of either party to show that there is a proper transition plan. I firmly believe that we can do it, but honestly, the hon. Gentleman knows that it is not the case that new licences will somehow guarantee a future for those North sea workers. How could he possibly say that four days’ worth of gas demand in 2050 will guarantee a future for those workers?

--- Later in debate ---

[Dave Doogan]

The premise of the hon. Gentleman’s intervention is that by delaying things, and maximising oil and gas production, we somehow maintain this link. We could just as easily deliver the same thing by accelerating the delivery of renewable energy and the infrastructure to transmit it to where it is needed. That would have the added benefit of introducing lower bills for consumers and industry, and making sure that we are not reliant on petrostates from far away with questionable regimes. I am looking through the right end of the telescope, whereas the hon. Gentleman and his Government are looking through the wrong end.

In short, the Tories could not give a flying fig for any worker on these islands—as long as their share price remains healthy, to hang with the rest of us. If the question is “How do we protect and transition oil and gas jobs into renewable energy production?”, the answer is definitely not to overstimulate unlimited offshore petroleum licensing. According to industry data, 441,000 jobs were supported by the oil and gas sector in 2013, but that number has already fallen to 215,000—so we are talking about 200,000 fewer jobs in 2022. The Government have issued approximately 400 new drilling licences, in five separate licensing rounds, in that period. The claim that there is a direct and proportionate relationship between the amount of licences issued and the amount of jobs sustained is entirely spurious.

[Douglas Ross]

Can the hon. Gentleman explain to the House and, importantly, his constituents in Angus, many of whom are employed in the industry, what the Scottish National party’s current position is on the issuing of new oil and gas licences? At the moment, does it support them? Or is there is a presumption against them?

[Dave Doogan]

What is important is the understanding that we will be reliant on oil and gas. This Government are creating a false dichotomy between having unlimited new licences and having an oil and gas sector in Scottish waters and within the UK; the two things are not related in the fashion that they are setting out. The hon. Gentleman should be asking why the UK Government will not match the Scottish Government’s ambition for the just transition and our half a billion-pounds of investment, but I will get on to that in a second.

[Douglas Ross]

rose—

[Dave Doogan]

Is the hon. Gentleman asking whether I am giving way?

[Douglas Ross]

For clarity—

[Dave Doogan]

No, I am not.

Where is the guaranteed ringfencing of revenues from North sea oil and gas production to develop more renewable energy and accelerate the just transition? Accelerating the just transition—not unduly sustaining legacy energy production—will make the difference and deliver real jobs with sustainability, in terms of both the carbon outputs and how those jobs will last into the future. Where is that support?

The Government have claimed that the circa £50 billion in tax revenue over the next five years “could” be used to support the shift to cleaner forms of energy—we are used to jam tomorrow from this Government—but any other form of fiscal revenue could be used to support the future development of renewables. The vacuous observation that the Government have made is so unconnected to reality, unconditioned and unqualified as to be meaningless.

It would have been an uncharacteristically elegant solution for this Government to have ringfenced future oil and gas revenue for the green transition, to marry the endowment of the legacy hydrocarbon industry to the priming of the pump of opportunities of the next renewable industry, but this Government are at least consistent in their ability to disappoint.

To the casualty of the climate from this Bill, which is an inevitable consequence of this course of action, we can add the pace of delivery for the new net zero economy opportunities in Scotland. When oil and gas opportunities go to a plateau of exhaustion in Scotland, as everyone knows they will, what will be left in the cupboard to support communities such as those in Banff and Buchan, Angus, West Aberdeenshire and Kincardine, and elsewhere in the north-east of Scotland? Why are the revenues from the historical exploitation of oil and gas not going into accelerating renewable opportunities and making sure that we deliver jobs for the future?

As I said in response to the intervention by the hon. Member for Moray (Douglas Ross), the Scottish Government have invested £500 million into the green transition for Scotland—[Interruption.] Well, unlike anything to do with this Bill, that funding is allocated and is there to be invested. I will tell you why, Mr Deputy Speaker, this Government are nervous of that figure: because if the UK were to match Scotland’s ambition in the just transition, it would be £5 billion across the UK, but we see no such commitment, vision or climate ambition. What we see is a Tory Prime Minister who cannot effectively lead his party, let alone the UK state or an energy transition, seeking to divide people on the climate, and rolling back on climate action commitments and signals given to industry on electric vehicles and boiler replacements, while over-exploiting Scotland’s legacy hydrocarbons and dragging his feet on carbon capture, usage and storage, especially Acorn.

The picture is revealed even for those with the largest blinkers. The hallmark of failure is stamped on this Tory Government, who will politicise anything, even the climate consensus, in a vain attempt to stem their electoral destruction. The Bill fails to outline a transition away from fossil fuels as per the agreed resolution at COP28, on which the ink is barely dry. The UK delegation signed up to that agreement in the full knowledge of this Bill’s impending passage. We all know that the UK has a questionable approach to its international obligations, but this is plain bad faith.

Finally, the Bill does not acknowledge the climate emergency. In fact, with this Bill the Tory Government are thumbing their noses at the climate challenge that we all face together and should address together. In the Bill, the Government seek to over-capitalise on legacy energy production rather than invest in the renewable energy jobs of the future. Much of that employment and enterprise will be in demand mitigation, with thermal insulation, equipment upgrades and new technologies. As a result of the ambition that drives the Bill and the warped thinking behind it, jobs, the economy, bill payers and the climate will suffer, so I urge Members to decline to give it a Second Reading.

--- Later in debate ---

[Douglas Ross (Moray) (Con)]

It is an honour to speak in the debate about the oil and gas sector, the industry and the jobs that rely on it. Certainly, in my Moray constituency, many people are employed in the sector. They travel through to Aberdeen to go off shore, and it is a regular commute for many people. That is the case in towns and villages throughout Moray, such as Buckie.

Since I have been able to get Buckie into this debate on oil and gas, it hopefully allows me the opportunity to put on the record my appreciation to the club for an outstanding match against Glasgow Celtic yesterday at Parkhead in the Scottish cup. They sadly lost 5-0, but it was an outstanding game for the highland league team. Graeme Stewart and his players did not just do the club, the highland league community and Buckie proud, they came away with an absolute host of new fans, because of what they achieved over the weeks since that game first came into the public domain. It has been great to see cup fever in Buckie and to see stalwarts of the club, such as Annie Jappy and Sandra Paterson, recognised for everything they have done for the club over many years. I am sure the congratulations of everyone in the House go to Buckie Thistle on their achievements.

[David Duguid (Banff and Buchan) (Con)]

I of course join my hon. Friend in congratulating Buckie Thistle, but will he answer just one question: which side played in the home strip?

[Douglas Ross]

Of course, they both play in green and white hoops. Celtic played in green and white, and Buckie were in yellow.

As I say, this is an important debate for many towns, villages and communities in Moray, because a large number of people living in that area are employed in the oil and gas sector. It is important for my constituents in Moray, and I have been clear that it is right that we continue to grant new oil and gas licences to continue the exploration in the North sea while there is still a demand that needs to be supplied, but people will be left wondering what is the current position of the SNP. That is why I put a very direct question to the hon. Member for Angus (Dave Doogan). Normally at this point I would say that I will give way to any SNP Member willing to intervene if they are able to answer, but there is only one here. Would the hon. Gentleman like to intervene and say very simply, to the people of Angus and the people of Scotland, what his party’s position is and what his personal position is? Does the SNP support the granting of new oil and gas licences —yes or no?

[Dave Doogan]

I thank the hon. Gentleman for this opportunity to reiterate what I said previously. There is a fundamental understanding of the ongoing role of oil and gas in meeting our energy needs. Whether that is dealt with and satisfied through existing licences or future licences is a moot point, and I will tell him why: I have already demonstrated, in as simple terms as I can, that the implication that there is a direct and proportional link between job security and licences issued is spurious. I am aware of the point he is trying to make, but he is not making it well. I have told him what the situation is, and he can either like it or lump it.

[Douglas Ross]

I would just like an answer. I have tried twice, and that was as clear as mud. I think people looking at that answer will actually be unable to tell what the hon. Gentleman’s personal position is and what the SNP’s position is. That is really important. Maybe it is telling that only one SNP MP has turned up to a debate about the oil and gas sector—

[Dave Doogan]

Have you seen the weather?

[Douglas Ross]

I have seen the weather. I saw the weather when I left Inverness airport at 6.45 this morning. I know what the weather is like in Scotland, but it is important that when we are debating the oil and gas industry, which is crucial to Scotland and the United Kingdom, the SNP can find only one MP to turn up.

[Sammy Wilson]

Does the hon. Gentleman accept that for the 90,000 employees of the oil and gas industry in Scotland and the 200,000 across the United Kingdom, an answer that says it is a moot point is hardly the right one to give? It looks more like a mute position adopted by some of the opposition Members in this debate.

[Douglas Ross]

I absolutely agree with the right hon. Gentleman. People should watch closely what the hon. Member for Angus said on his own behalf and on behalf of the SNP—as I say, SNP MPs are speaking with their actions tonight by not even turning up to the debate.

Opponents of this Bill—the Labour party, the SNP and others—try to present our energy transition and support for oil and gas as a binary choice. They say that we cannot achieve our net zero goals while at the same time supporting new oil and gas licences and projects, but nothing could be further from the truth. The oil and gas sector in Scotland and across the UK is essential to delivering and achieving net zero.

The investment in green energy infrastructure that will allow us to build our renewables capacity is coming from the revenue from oil and gas extraction. The businesses that are looking to expand offshore wind and the windfarms for tomorrow are staying solvent today because of their revenues from North sea oil and gas. The people with the skills and expertise that we have heard about throughout this debate, which will be required to secure our offshore renewables going forward, work in our oil and gas sector today. That is why it is so important that I made the point to the right hon. Member for Doncaster North (Edward Miliband) that people such as Sir Ian Wood are saying that Labour’s plans and the cliff edge that Labour would impose on the sector would see job losses. That is why that position is frankly unacceptable and is not supported by many people, if any, in the north-east of Scotland.

The businesses, the investment and the jobs that make Scotland and the UK a world leader in oil and gas are the same skills, businesses and jobs that are going to drive forward the green agenda and our renewables future. We cannot have one without the other. We cannot tell investors, businesses and workers who pause their plans for the UK’s energy infrastructure due to an artificial ban on new fields to come back when the green technologies have become cheaper or more viable, because those investors, those businesses and those workers will go elsewhere. I say to the hon. Member for Angus that that is not a moot point. That is the reality if we do not continue with the exploration of oil and gas in the North sea and the granting of new licences.

[David Duguid]

I am sure that my hon. Friend will join me in welcoming the vast number of offshore wind projects being developed off the coasts of our respective constituencies—as well as that of the hon. Member for Angus (Dave Doogan)—and the operations and maintenance facilities in Buckie in his constituency and Fraserburgh in mine, which are entirely dependent on those offshore wind facilities. As much as people from the oil and gas industry are moving into them, there are just not enough of those jobs to make up for those that we would lose in oil and gas. Does he agree that a lot of the people who work in oil and gas would not go to renewables if there were no oil and gas jobs, but would just go where there is oil and gas overseas?

[Douglas Ross]

I absolutely agree with my hon. Friend. We have a base at Buckie harbour that is supporting a number of jobs and will continue to do so for decades to come—it is a small number of jobs at the moment, with opportunities to grow—but at the moment the vast majority of the workforce is employed in the oil and gas sector. I agree with him that they will go elsewhere, shifting their jobs and expertise to other countries, and another city will become Europe’s offshore energy capital. That would be devastating not just for our net zero ambitions and for Aberdeen, but for the economy of Scotland and the UK as a whole.

We have already heard in the debate that 90,000 Scottish workers are employed in North sea oil and gas. It has been for decades, and will continue to be for some time to come, one of the most important sectors in Scotland’s economy. Yet I believe that it is the position of the SNP—it would be if more SNP Members than just the hon. Member for Angus had turned up to state their case—to put those jobs on the scrapheap. The SNP wants to have a cliff edge in our oil and gas sector and exploration because it is in government with the Greens in the Scottish Parliament. It is supporting Green Ministers who want an immediate end to the extraction of fossil fuels from the north-east, and that is putting those 90,000 jobs, and the Scottish and UK economies, at risk. That is viewed extremely dimly in many parts of Scotland, particularly the north-east, which the hon. Member for Angus represents.

[Dave Doogan]

It is a bit rich listening to a Scottish Tory MP talk about the bountiful experience of North sea oil and gas for Scotland. If we had been independent in the ’70s, we would be embarrassingly well off compared with our neighbours elsewhere in these islands. The hon. Member says that we want to throw workers in the oil and gas industry in Scotland under a bus, and that we want to see a “cliff edge” where those jobs disappear. What is his evidence for that? We are investing in a just transition. Whereas he is trying to pursue an endurance of legacy opportunities for employment, we want to turbocharge new opportunities for jobs over 150 to 200 years.

[Douglas Ross]

My evidence is very clear; in fact, it is the hon. Gentleman’s own words. When he cannot even tell this House or his constituents about the SNP’s position on the presumption of new oil and gas licences, that is an answer in itself—not a moot point. The SNP clearly does not support it, and he cannot quite find the words to say it yet. That is the SNP position because it is in office with the Greens in Holyrood, and they are increasingly abandoning the north-east oil and gas sector and the jobs that rely on it. As I say, that is viewed extremely dimly not just in the north-east but right across Scotland.

[Caroline Lucas]

Nobody is talking about turning off oil and gas taps overnight—nobody; not even Just Stop Oil—so will the hon. Gentleman cut the amount of rubbish coming out of his mouth? He is criticising people who are not here in any numbers to be able to defend themselves. Why does he not focus on his own record rather than attacking others in such an erroneous way?

[Douglas Ross]

It is not erroneous, because we know that the co-leader of the Scottish Greens, Patrick Harvie, has said that he would like to stop oil and gas exploration overnight. That is the Green position: they do not want oil and gas to come out of the North sea, and that will affect jobs there right now. That is the point that I, and indeed other hon. Members, have been making.

[Caroline Lucas]

Will the hon. Gentleman give way?

[Douglas Ross]

I have already given way to the hon. Lady, and I can see that she has copious notes in her hand, so she will be contributing to the debate. I have already taken some time, so I will continue my speech.

The SNP will put those jobs on the scrapheap and turn its back on the north-east of Scotland. Yet, at the same time, Humza Yousaf is telling the people of Scotland that oil and gas revenues will pay for an independent Scotland. The SNP does not want to take the oil and gas out, but it wants to get the benefits to pay for failing public services in Scotland, which it has let down during its 17 years in power. Of course, Labour and Scottish Labour are also opposed to the Bill. Frankly, it is quite derisory that MSPs and the Scottish Labour party will not stand up for the north-east of Scotland and will allow those jobs, skills and the expertise gained over decades to be lost. The stark reality is that the Opposition parties are putting tens of thousands of Scottish jobs at risk, and putting the UK’s energy security in jeopardy when we need it most.

When illiberal, violent regimes such as Putin’s Russia are using energy resources as a means of funding their destructive wars, we cannot close our eyes and ears and pretend it is not happening. The UK will still have a demand for oil and gas products—and not just in energy but, as we have heard, in plastics and medicines, to name just a few. That demand will not go away in an instant; many of the homes that rely on those products and heating will require them for many years to come. Why should we not try to deliver on as much of that demand as we can through domestic production? Importing our energy will only increase emissions further and help those intent on manipulating energy markets for malign purposes.

I urge Members to support the Bill. Let us secure the UK’s energy future and deal a blow to the regimes that are intent on using energy as a weapon. Let us protect our economy and the livelihoods of tens of thousands of Scottish and British families across the country. Let us choose common sense—a practical transition to net zero—not naivety and wishful thinking. Let the Labour and SNP Members present explain in their speeches why they will join together to try to vote down the Bill and the opportunities that oil and gas will continue to bring Scotland and the UK for decades to come.