In the wake of the government’s Autumn Budget, those of us working at the sharp end of the UK’s offshore energy supply chain find ourselves, yet again, fearing the worst.
The decision to retain the Energy Profits Levy (EPL) until 2030 has landed with considerable weight across the North Sea, not only for the operators who plan and finance major projects, but for the thousands of skilled people whose livelihoods depend on a stable and investable environment.
At Mermaid Subsea Services (UK), we see this up close every day. Our teams support operations that keep the UK powered, while keeping the transition to cleaner energy on track.
The Budget’s own figures show just how much is at stake. According to the Office for Budget Responsibility, North Sea revenues are forecast to collapse by 93% by 2030, from £4.5 billion to £0.3 billion, primarily due to declining domestic production driven by the continued application of the EPL. At the same time, the cost of importing energy soared above £60 billion last year. Current policy is dangerously paradoxical.
Far from being abstract numbers, these reflect a system under strain, in which we risk swapping high-value UK jobs and tax receipts for higher emissions and growing reliance on global energy markets. None of this supports the ‘managed and just transition’ that governments north and south of the border have long promised.
But there can be a constructive path forward. The introduction of the new Oil & Gas Price Mechanism (OGPM), designed to replace the EPL, is a welcome step toward restoring stability. HM Treasury’s own criteria state that a windfall occurs only when Brent hits around $95, a level not seen since 2022. In other words, by the government’s own definition, the EPL no longer reflects today’s market realities.
That is why I - and many across our industry - support Aberdeen & Grampian Chamber of Commerce in urging the Chancellor to bring forward the OGPM to 2026. Doing so is the single most impactful move the government can make right now to safeguard tens of thousands of jobs, unlock more than £50 billion of investment and ensure the skilled workforce we rely on remains anchored here in the UK as we build the energy systems of the future.
This is not about resisting change, indeed we are a sector that has changed time and time again over the years. And as an industry, we are evolving, rapidly and irreversibly yet again. Companies that once focused solely on oil and gas are now branching out into offshore wind, subsea engineering for renewable projects and life-extension strategies that ensure existing assets are operated safely and efficiently while new technologies scale. At Mermaid, we have partnered up with Energy Pathways to advance the development of the Marram field, a short cycle low emission gas field and a key cog in the wider Marram Energy Storage Hub (MESH).
But the transition depends on a functioning, world-class supply chain. That supply chain can only thrive when the policy environment matches the ambition we are being asked to deliver.
The choice before the government is clear. Keep the EPL in place until 2030 and accept further job losses, weakened investment and diminished resilience. Or work with industry to accelerate the OGPM, providing a stable, predictable fiscal regime that supports energy security, economic growth and a transition built on continuity rather than disruption.
In her Autumn Budget the Chancellor acknowledged the central role of the North Sea in meeting the UK’s energy and economic needs, both today and in the decades ahead. It is time policy reflected that fact.