MORE POWERS WOULD SEE A SUSTAINABLE SYSTEM FOR NORTH SEA

MORE POWERS WOULD SEE A SUSTAINABLE SYSTEM FOR NORTH SEA

Speaking at the UK Oil and Gas Business Breakfast in London today (Tuesday) SNP Energy spokesperson, Mike Weir MP, set out how the devolution of more powers to the Scottish Parliament could breathe new life into the oil and gas sector and see a more sustainable regime for the North Sea.

Mr Weir, who is also a member of the Commons Energy and Climate Change Select Committee, highlighted the Scottish Government’s National Conversation paper on Energy as part of the publications which set out how Independence could benefit Scotland energy sector. Mr Weir emphasised that oil and gas will be a major part of our economy for many years to come.

Mr Weir said:

“With greater fiscal autonomy the Scottish Government could tailor the North Sea tax and regulatory framework to reflect the challenges experienced by operators in developing new fields and ensure that extraction levels are maximised. Devolving responsibility for the North Sea fiscal regime would also allow the Scottish Government to invest a share of the returns from oil and gas production into an oil fund.

“This would allow a proportion of Scotland’s oil and gas revenue to be converted into a pool of renewable assets, generating long term wealth long after North Sea oil and gas reserves have been exhausted. An oil fund could also act as a short term stabilisation mechanism, to provide a fiscal stimulus when the economy slows or to offset a temporary fall in tax receipts.

“The existence of oil and gas off our shores puts us in an enviable position in some respects as we have a cushion during the transition to a low carbon economy, but it also presents a huge challenge given the huge numbers that work in the industry. We need to carefully manage that transition and ensure that the skills developed in the North Sea are retained and transferred into jobs in the new economy. We must ensure that carbon jobs are transformed into green jobs.”

Mr Weir stressed that it was vital that the tax regime also ensured that the current infrastructure within the North Sea was retained and available for use in the new green industries, particularly Carbon Capture and Storage. Mr Weir added:

“There is huge potential for CCS linking power plants like Longannet with the ability to store the gas in depleted oil and gas fields. We must retain the current infrastructure in place to ensure we can take advantage of this huge opportunity. UK Government dithering lost the ground breaking Peterhead project, we must not allow it to let current infrastructure decay and lose the chance of development of this important industry.”