Oil and Gas Authority (Offshore Petroleum) (Disclosure of Protected Material after Specified Period) Regulations 2018

Lord Grantchester Excerpts

Thursday 19th July 2018 Lords Chamber

[Lord Grantchester (Lab)]

I am grateful to the Minister for his explanation of the statutory instrument before the House today. I understand that it is among the last necessary to commence the provisions of the Energy Act 2016, and I am happy to approve it. As the Minister said, the Act set up the Oil and Gas Authority following the 2014 Wood review into the future of the UK’s offshore petroleum industry with the objective of maximising economic recovery—MER—of offshore petroleum reserves. With powers to offer necessary information, the OGA, through these regulations will now be able to make this information public after a specified period.

I am grateful that, through this MER, the Minister can confirm—with the noble Baroness—that the petroleum industry could create £140 billion of gross value added for the UK and create many thousands of jobs. Most notably, information disclosure could facilitate the reuse of reservoirs and infrastructure most necessary for the development of carbon capture and storage, previously damaged through the Government’s cancellation of CCS projects. Remarks from the Minister in his reply confirming the Government’s commitment to help economically viable ways to develop CCS would be most welcome.

The success of these regulations is very much dependent on the OGA’s ability to assess the commercial sustainability and confidentiality of any pertinent information that it proposes to disclose. The memorandum gives confidence that the Government and the regulator have worked extensively together through consultations and reviews to reach a satisfactory point whereby companies can share and the OGA can publish information sensitively, in a balance between the objective of maximising economic activities and the company’s economic interests. I understand that the appeal mechanisms are included in further provisions of the Energy Act and, if the OGA and the industry can develop a modus operandi to the satisfaction of both parties, that is to be applauded. Will the Minister commit to reviewing and making a statement on this in due course as the success of MER is transparently demonstrated?

One aspect of this was not highlighted by the memorandum. Some information revealed—for example, in relation to seismic survey results—could be sensitive and relate to national security. Are provisions in place for the Government to instruct and advise against the disclosure of certain information by the OGA? In its objective to maximise economic recovery, the OGA will certainly make information available that is of much use and interest to academics, researchers and companies generally in the sector. How does the OGA propose to make this information available? Will it have one preferred method? Will the Government work with the OGA not only to ensure that the information is made easily accessible and well publicised, but that it is effective? Will this be on an international basis? I would be grateful if the Minister could outline how Parliament will be kept updated on the progress of MER.

With that, I am happy to endorse the remarks of my honourable friend and shadow Minister in the other place, Alan Whitehead, that,

“this is a well-crafted set of regulations that should greatly enhance the ability of the industry and the general public to understand what is happening in the North sea, and, where appropriate, to be supplied with that material in a reasonably timely fashion”.—[Official Report, Commons, Eighth Delegated Legislation Committee, 17/7/18; col. 6.]

[Lord Henley]

I thank the noble Baroness, Lady Featherstone, and the noble Lord, Lord Grantchester, for their comments, and in particular the noble Lord, Lord Grantchester, for repeating what his colleague said in another place. He made it clear that these are, as he put it, well-crafted regulations. It is always gratifying to those of us who move these instruments in either House to hear that, but it is equally gratifying for our officials, draftsmen and others. I will make sure that those remarks are brought to the attention of those who are responsible for producing these regulations.

I am also grateful to the noble Lord for stressing that the aim behind these regulations is to reinforce the aim of the 2016 Act of maximising economic recovery. I shall therefore repeat the figure: we think that there is the chance of creating some £140 billion of additional gross value for the UK, which is very important to us all. It is also important for the oil industry in the north-east of Scotland, as we discussed only the other day when a noble Lord on the Liberal Democrat Benches asked a Question about the oil industry in Scotland. Maximising economic recovery is important.

I shall deal with the points made about carbon capture and storage. The noble Lord will understand that this has great potential in terms of helping to decarbonise the economy and maximising economic opportunities for the UK. Obviously we want the UK to become a global technology leader in this area by working with global partners to reduce costs and accelerate deployment. We set out in the clean growth strategy a range of actions in both the domestic and the international arenas to unlock the potential for CCS. Again, we are investing quite large figures—£100 million; I stress that it is £100 million, not billion—in innovation in this area. We should do what we can in this area.

The noble Lord also asked about a review. I should remind him that the Energy Act put an obligation on the Government to review the performance of the OGA every three years, and obviously that will include the disclosure provisions. On whether the Government can stop the publication of certain things, the OGA can advise against disclosure using powers under the Energy Act if national security requirements come into play. On how information and samples will be made available when published, the OGA is progressing plans to set up a national data repository for digital data in 2019, which will enable this type of data to be stored securely and sustainably. It will allow access and disclosure to be controlled by the OGA with information becoming accessible to the public once published. Other summary information and production information will be made available on the OGA’s open data pages on its website. Again, that will be available to academics at the proper time.

I think that those comments deal with all the questions that were put to me. I can confirm that, as I made clear in my opening remarks, this is the last piece of the jigsaw in relation to these matters following the Energy Act. I think that this is also the last occasion before the Summer Recess on which those of us who either speak for BEIS or respond to energy or BEIS questions from the Opposition Benches will be likely to perform. I therefore wish the noble Baroness and the noble Lord a happy holiday, and beg to move.