Energy Minister Ed Miliband has, according to a report in the Telegraph, and a bulletin released by GB News, announced an immediate halt on new North Sea oil and gas licences, a decision that would have a disastrous impact the north-east of Scotland’s economy. This unexpected move halts the anticipated approval of new drilling, which was set to be confirmed in the coming weeks. The ban affects applications for 35 new sites under consideration by the North Sea Transition Authority (NSTA). An official government announcement is anticipated shortly.
Speaking to Energy Voice, The NSTA confirmed the policy change, stating: “We will not issue new licences to explore new fields, and will not revoke existing oil and gas licences. We will manage existing fields for the entirety of their lifespan.”
This decision aligns with Labour’s pre-election pledge to stop issuing new licences for oil and gas exploration in the North Sea. The party argues that new licences “will not take a penny off bills, cannot make us energy secure, and will only accelerate the worsening climate crisis.”
However, the move has raised concerns about its impact on jobs and the economy in Scotland. The oil and gas sector reportedly added £30bn to the UK economy in 2022, supporting 200,000 UK jobs, including 90,000 in Scotland.
Scottish Conservative MP for West Aberdeenshire and Kincardine, Andrew Bowie, said to Aberdeen Business News: “This reckless move by Ed Miliband confirms that Labour are no friends of Scotland’s vital oil and gas industry.
“The new Energy Secretary is happy to turn off the taps in the North Sea and put tens of thousands of jobs at risk.
“His economic and environmentally illiterate policy of banning further exploration – which is supported by the SNP – is even opposed by his own officials.
“Keir Starmer should step in and reverse this decision immediately, or risk major damage to our energy security and Scotland’s economy.”
Industry representatives have also expressed concern. In the Telegraph report, David Whitehouse, chief executive of Offshore Energies UK, said:
“We remain deeply concerned that some of the new proposals being put forward for our industry will undermine the energy transition we all want to deliver.
“Labour’s leadership has recognised that North Sea oil and gas will be with us for decades to come and they have committed to managing this strategic national asset in a way that does not jeopardise jobs. They now need to deliver on their commitment to support our industry.”
The ban on new licences comes as the UK grapples with balancing its climate commitments and energy security needs. It remains to be seen how this policy will affect the UK’s energy landscape and economy in the coming years.
Whereas the SNP have in recent years supported similar action former First Minister and leader of the Alba Party, Alex Salmond has criticised the reported decision, he said:
“This is the sort of adolescent political posturing which could cost tens of thousands of skilled jobs across the UK but concentrated on the North East of Scotland. Miliband should remember that in Government careless talk costs jobs.
“Miliband should stop playing to the gallery and take the time to consider a rational energy policy. An immediate cessation of drilling would not only kick workers in the teeth it would embroil the Labour Government in legal actions which would last years if not decades. The new Energy Secretary needs to get his Department and its muddled communications under control.“
