Tom Greatrex, MP, the Shadow UK energy minister has visited Aberdeen on a fact-finding mission to listen to industry leaders on how best to help the offshore N. Sea oil and gas sector.
This included a visit to the local offices of Centrica Energy and Bibby Offshore, where the Hamilton MP was given an update on the £1.5 billion Cygnus project, where Centrica has a significant interest and which is creating nearly 5,000 jobs in the UK supply chain.
He also met with some of the teams working across Centrica’s UK operations, including geologists, engineers and HSE experts.
Greatrex also toured The Hangar at Bibby Offshore’s 50,000 ft² workshop and warehouse facility in Westhill. With diving and ROV equipment on site, he learnt about Bibby Offshore’s capabilities and development since inception in 2003 and met two of the company’s ROV apprentices – Alexander Tice (17) and Edward Beattie (19).
Afterwards, Greatex said:“Visiting both Centrica Energy and Bibby Offshore provided a great insight as to how companies work together from both the operator and supply chain perspective. It’s fantastic to see such positive and successful collaborative work within the industry, and the wealth of skilled and dedicated people that work within it.”
David Sheret, General Manager, Global Business Development, Bibby Offshore, said: “We realise our success is down to our people, and understand fully the importance of valuing and investing in our staff. Our training programmes often act as a way to build a bridge from education to industry, and as a company we aim to help provide and improve opportunities for ambitious and talented individuals.”
Mark Lappin, Exploration and Subsurface Director, Centrica Energy, said: “It is vital that we work closely alongside our partners, service companies like Bibby Offshore and the Government to bring these projects to life and continue investing in the UK, especially in an environment of low oil prices.”
Greatrex’s visit coincided with Centrica accouncing its annual results for 2014 yesterday, which group chief executive Iain Conn described as “a very difficult year for Centrica – and the recent fall in oil and gas prices creates further challenge. “
Centrica – which owns the Scottish and British Gas brands – plans to cut exploration investment and other costs (which may include jobs) by this summer.
Conn added: “The 2014 environment was very difficult for Centrica, with record mild weather in the UK, extreme cold weather in North America early in the year and a highly competitive market environment on both sides of the Atlantic.
“Upstream, the exploration and production (E&P) business faced falling oil and gas prices, while Centrica Storage was impacted by lower seasonal gas price spreads. Political uncertainty and the launch of the Competition and Markets Authority investigation provided further challenges in the UK.”
At British Gas these conditions translated into falls in gas and electricity sales volumes of 20% and 8% respectively, and a 2% fall in residential energy customer accounts, mostly in the first half of the year.
Direct Energy also saw a 3% fall in residential energy customer accounts.
In Centrica Energy, oil and gas production volumes of 79.5mmboe were up 3% compared to 2013, but realisations fell as a consequence of lower oil and gas price levels and the power business experienced unplanned outages on the nuclear fleet.
As a result, adjusted earnings per share fell by 28% compared to 2013. Centrica also took a hit on pre-tax exceptional items of £1,597 million, £1,161 million post-tax, which included substantial impairments on E&P and power assets totalling £1,385 million post-tax, primarily as a result of the current low commodity price environment.