If you read
some of the reaction to Rosebank being granted approval today, you would be
forgiven for thinking that the UK no longer needs oil and gas.
You might also
be left with the impression, based on the commentary from some of our
politicians, that we are awash with cash and don’t need the tax revenues or
215,000 jobs that the industry creates.
However, both
points could not be further from the truth, which is why Rosebank going ahead
is good news.
It will create
hundreds of new jobs, result in over £6billion being spent in the North Sea
supply chain anchored in Aberdeen, and it will provide the UK with enough gas
to power tens of thousands of homes for the lifespan of the field.
Those who are
opposed are doing so from a place of concern, but they need to zoom out and
look at the bigger picture before demanding that we cease new activity in the
North Sea.
Rosebank is
not growing the UK’s production levels, it helping to offset two decades of
sharp decline.
Since 1999, production
in the North Sea has fallen by 70%.
Crucially, it
has been declining three times faster than energy consumption in the UK, which
has left us increasingly reliant upon imports to
fill the gap, including some which come with emission levels four-times higher
than domestic production.
For me, that
is why the discussion around ending North Sea production can only occur when a
viable alternative is in place.
The path to
net zero as we make the next step in this transition requires four things – and
they span business, government and the public at large.
First,
we need to reduce demand, and that involves everyone. Right now, three-quarters
of the UK’s energy consumption is derived from oil and gas. That’s
what is fuelling 24 million homes with gas boilers, 32
million vehicles fired by diesel and petrol, and the power stations
generating more than 40% of our electricity.
Second,
we need to develop new sources and ways of storing energy – such as
hydrogen and offshore wind – to help us further diversify our energy mix.
Third,
and perhaps most importantly, we need the public and government to understand
and accept that this could easily take two, perhaps three decades, to
deliver.
And
fourth, it requires us to find the most efficient way to source oil and gas in
the meantime. And that is the North Sea.
If the
alternative is importing oil and gas at a greater carbon cost, then we must
always favour domestic production.
It’s simple,
it’s pragmatic and it commits us to sourcing the fossil fuels we need in a
manner which minimises emissions and secures tens of thousands of Scottish
jobs.
Ryan Crighton is Policy Director at Aberdeen & Grampian Chamber of Commerce