EXCLUSIVE By DARA BUTTERFIELD
Matthew Hancock, UK Energy and Enterprise Minister, has reaffirmed the Government’s commitment to the North Sea oil and gas sector at a key energy conference in the run-up to next week’s British budget.
Hancock said: “This year we are celebrating the 50th anniversary of one of the UK’s greatest industrial success stories. Since the first North Sea oil started flowing in 1975, 42 billion barrels of oil have been recovered so far.
“And with another 20 billion or more to still be drawn from this mature basin it’s clear that oil and gas will form an integral part of the UK energy mix for decades to come.
“We are committed to helping investors deliver on this. The North Sea may be maturing, but it still has many advantages and remains an enormously attractive place to invest.
“We’ve already introduced a range of fiscal measures to stimulate further investment in the offshore energy sector. These measures have been successful, with almost half of the record £14bn investment in 2013 incentivised by field allowances.
“And we all look forward to the Budget next week. But industry can’t just wait for fiscal changes. This is a partnership, and we need industry to step up and address rising operating costs and reverse recent declines in operating efficiency.
“There’s still a lot of work to do, but we have to get this right and I know that your industry will rise to the challenge.
“The North Sea may be mature but it’s not yet in its twilight years.
“By working collaboratively under the guidance of the new <Aberdeen-based> Oil and Gas Authority there are still many barrels to recover from the basin which will sustain this great industry for years to come.”
Hancock also mentioned his support for low carbon technologies – including wind and nuclear – as well as unconventional oil and gas energy sources.