Having used North Sea oil riches as one of the main pillars of the case for Scottish independence in 2014, Nicola Sturgeon appears to have undergone a Damascene conversion to aggressive environmentalism in the intervening years.
In October, the Scottish First Minister said it was “fundamentally wrong” for her country to continue exploring and extracting oil and gas until the last possible moment and warned the Cambo oil field “should not get the green light”.
This is a very different tack to the UK Government’s plan to introduce future “checkpoints” that will take into account domestic demand for oil and gas, projected production levels and the increase in clean technologies such as offshore wind.
The energy sector will face targets to reduce emissions by 10pc by 2025, 25pc by 2027 and 50pc by 2030. We can have a debate about those targets. But it is surely right to follow a well signposted roadmap to net zero.
It may have very understandably slipped below most people’s radar but Sir Ed Davey, the leader of the Liberal Democrats, said over the summer that he wants to ban new listings by fossil fuel companies on the London Stock Exchange and prevent the issuing of new bonds to raise money for oil and gas projects.
Clearly there’s only a very small chance Sir Ed will get to implement these policies – even in a coalition government. But it’s worth bearing in mind the vehemency of Sturgeon’s recent anti-North Sea rhetoric has coincided with the period in which the SNP has been able to shore up a small governing majority thanks to the support of the Scottish Greens.
Companies that are planning to invest in projects that could last decades are constantly assessing these kinds of political risks.
Nearly three quarters of UK energy was generated by oil and gas in 2019. However, only seven exploration wells were drilled in the North Sea last year, the smallest number since 1965. The region was producing 1.7bn barrels of oil equivalent in 1999. That figure will plunge by 88pc to 0.2bn by 2030 unless new fields and wells are opened.
Very few people disagree that the world should seek to transition from fossil fuels to renewable sources of energy. However, most also agree this process will take years if not decades. Without proper planning the UK will end up importing more fossil fuels, which will leave us diplomatically compromised and likely cause greater environmental damage.
We don’t even have to predict how this will all play out. We’ve already seen it with the incredibly short-sighted handling of the Rough gas storage facility, which failed to win Government support in times of plenty, was closed down and is now being reconsidered after gas prices sky-rocketed.
There’s a big difference between managed decline and wanton neglect. In the matter of the North Sea’s gas and oil reserves, Westminster is in danger of erring towards the latter. Holyrood has already embraced it.
