Ukraine: Gas Supplies

Lord Lawson of Blaby Excerpts

Wednesday 2nd April 2014 Lords Chamber

[Baroness Verma]

My Lords, my noble friend is absolutely right to raise this very important issue, and it is right that the Government are encouraging investment in domestic gas production to help to reduce our reliance on imports. We are also taking steps to support UK shale gas exploration by accepting the recommendations of Sir Ian Wood’s report following his recent review of how to maximise recovery of oil and gas in the UK continental shelf. However, the real answer must be to ensure diversity of supply so that we can ensure affordable and cleaner energy.

[Lord Lawson of Blaby (Con)]

My Lords, I am delighted to hear my noble friend say that we need to get ahead with the exploitation of our shale gas resources—their exploration, appraisal and development —which, as the Geological Society pointed out, we have in abundance. However, is it not time to follow up words with deeds, to sort out our immensely cumbersome and unnecessarily complicated regulatory system and to stop the present Secretary of State for Energy dragging his feet, as, I regret to say, he is doing at present?

[Baroness Verma]

My Lords, I am, as always, grateful for my noble friend’s intervention, because it enables me to lay out exactly what the department is doing. We are trying to streamline the planning processes so that we do not have unnecessary hurdles in the way. The Government have established the Office of Unconventional Gas and Oil to help to develop the shale gas industry in the UK. My noble friend will be aware of the new tax allowance recently announced by the Treasury, which will reduce the tax on a portion of a company’s production income from 62% to 30% at current rates. However, as with all projects, including shale, it must be subject to rigorous scrutiny through the planning system and the regulators and there must be proper engagement with local communities.