OGUK urges further oil and gas development to avoid surging import bill
SUMMARY
National oil and gas production could fell by 75% over the next decade if further fields are not developed.
By Joseph MurphyPOSTED IN:
UK upstream association OGUK has stressed the need for further oil and gas development in the UK to avoid a surge in the country's import bill.
OGUK said its research showed that the UK was already highly reliant on other countries for its oil and gas, and has to import around half of the gas it consumes. In the year to June, government figures showed that the UK imported £5.2bn ($7bn) in gas from Norway along with £6.1bn of oil. It took a further £524mn of gas and £3.2bn of oil from Russia, £675mn of LNG from Qatar and £2.8bn of oil from the US.
OGUK's warning comes after Scottish first minister Nicola Sturgeon for the first time stated her clear opposition this month to the Cambo oil project, a large oilfield west of the Shetland Islands that Siccar Point Energy and Shell plan to develop. The field is expected to deliver 170mn barrels of oil and 53.5bn ft3 of gas, but is still awaiting environmental approval.
OGUK warns that if new fields like Cambo are not developed, UK oil and gas production could fell by up to 75% by 2030. It notes that oil and gas accounts for 73% of the nation's energy, with gas heating some 24mn homes and providing 41% of UK electricity. The UK also has 32mn private cars and other vehicles on the road that run on diesel and gasoline, and while the government is looking to reduce demand, some 15bn barrels of oil will still be needed to refuel motor transport over the next 30 years, OGUK said.
"The UK's offshore oil and gas industry is committed to helping the UK government meet its ambitious net-zero goals. We accept all the science around climate change and the need to cut emissions, but this transition must be managed," OGUK CEO Deirdre Michie commented. "If we cut our own supplies of gas and oil faster we can reduce demand, then we will have to import more of what we need. Our import bills will go up without any reduction in volumes."
