Politicians need to focus on sustaining, not milking, the oil and gas
industry
The UK North Sea oil and gas industry, which is
predominantly controlled and operated out of Aberdeen, provides the UK with 75%
of its prime energy needs. By 2020 it is estimated that figure will rise to a
staggering 80%. It also sustains something like 400,000 jobs in the UK.
I mention that, because so many people in the UK
seem to be ignorant about the oil and gas industry's importance to them in their
every day lives and politicians seem cavalier about its
future.
No doubt they would feel differently if they turned on the light switch and nothing happened. If their dinner was raw. If their feet were cold. Or if their car had no fuel.
The taxi arrives from Europe's Energy Capital!
But the fact that this industry has helped to sustain UK plc for four decades and now needs a little support back, seems to be lost on our political leaders in Westminster (for it is there, for the moment at least, that our tax regime is decided).
There is estimated to be about as much oil left in the North Sea as has already been extracted. But, as one industry analyst put it, the second half of this game is "going to be uphill and into the wind". It is going to be more difficult and more expensive to suck the oil out of the ground.
Now, when the return on oil in the North Sea is already less attractive than most other oil producing regions in the world, that is a very strong incentive to turn your back on the UK and head elsewhere. The fact that the industry is still booming probably says more for the current high oil price, rather than any sensible measures from our politicians.
The Treasury, for example, seems to look on the North Sea industry as a cash cow. How else do you explain what the industry claims is a 22% higher Corporation Tax rate than applies to other industries in the UK?
The source of 75% of the UK's prime energy
needs - don't let it dry up!
The other thing that is sustaining a vibrant oil sector in Aberdeen City and Shire is the growing internationalism. There are said to be more than 300 international oil companies based in Aberdeen and businesses in this sector are now said to be doing 40% of their business overseas.
Go into relatively small businesses in Aberdeen and you will hear them talk of orders in the Gulf of Mexico, Azerbidjan, Dubai, China or Australia. They may even have offices there.
As long as there is a strong domestic oil and gas industry these businesses will stay here and export their knowledge and expertise. But, if we let the North Sea industry dwindle, and the local business becomes 40%, or less, of these company's turnover they won't hang around forever.
It's time for our politicians north and south of the border to waken up and smell the coffee!
Sustain and support the North Sea Oil industry and you:
No doubt they would feel differently if they turned on the light switch and nothing happened. If their dinner was raw. If their feet were cold. Or if their car had no fuel.
The taxi arrives from Europe's Energy Capital!
But the fact that this industry has helped to sustain UK plc for four decades and now needs a little support back, seems to be lost on our political leaders in Westminster (for it is there, for the moment at least, that our tax regime is decided).
There is estimated to be about as much oil left in the North Sea as has already been extracted. But, as one industry analyst put it, the second half of this game is "going to be uphill and into the wind". It is going to be more difficult and more expensive to suck the oil out of the ground.
Now, when the return on oil in the North Sea is already less attractive than most other oil producing regions in the world, that is a very strong incentive to turn your back on the UK and head elsewhere. The fact that the industry is still booming probably says more for the current high oil price, rather than any sensible measures from our politicians.
The Treasury, for example, seems to look on the North Sea industry as a cash cow. How else do you explain what the industry claims is a 22% higher Corporation Tax rate than applies to other industries in the UK?
The source of 75% of the UK's prime energy
needs - don't let it dry up!
The other thing that is sustaining a vibrant oil sector in Aberdeen City and Shire is the growing internationalism. There are said to be more than 300 international oil companies based in Aberdeen and businesses in this sector are now said to be doing 40% of their business overseas.
Go into relatively small businesses in Aberdeen and you will hear them talk of orders in the Gulf of Mexico, Azerbidjan, Dubai, China or Australia. They may even have offices there.
As long as there is a strong domestic oil and gas industry these businesses will stay here and export their knowledge and expertise. But, if we let the North Sea industry dwindle, and the local business becomes 40%, or less, of these company's turnover they won't hang around forever.
It's time for our politicians north and south of the border to waken up and smell the coffee!
Sustain and support the North Sea Oil industry and you:
1. Extend the life the principal energy source for
the country.
2. You underpin 400,000 jobs.
3. You encourage UK
exports.
Continue to milk the industry and you might as well ask the last person to emigrate to turn off the lights! (But, before you go, can you leave a few blankets and candles to keep those who remain in warmth and light.)
Change your energy provider with uSwitch
Continue to milk the industry and you might as well ask the last person to emigrate to turn off the lights! (But, before you go, can you leave a few blankets and candles to keep those who remain in warmth and light.)
Change your energy provider with uSwitch
Posted: Thu - May 3, 2007 at 03:07 PM
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Published On: Jun 06, 2007 07:39 PM
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Published On: Jun 06, 2007 07:39 PM