Tory grandee Lord Lawson has poured scorn on the future of the North Sea oil and gas industry.
The former chancellor and energy secretary said the sector could only be a “shadow” of what it had been in the past.
His intervention came during a debate in the House of Lords on the viability of oil and gas exploration on the UK continental shelf in the context of the low oil price.
Lord Lawson told peers the industry had had a “glorious past”, but added: “Is it not clear that its future can only be a shadow of what it has been?
“And that the future of our indigenous oil and gas industry must lie in the exploitation of our shale resources which are quite substantial?”
Energy Minister Lord Bourne affirmed his government’s commitment to shale exploration.
But he insisted it was not true to say the offshore industry was entering a period where its significance could be diminished.
Highlighting the start of production at the west of Shetland Laggan and Tormore gas fields, he added: “It’s certainly perhaps not what it was, but it’s still of enormous importance.”
At maximum production, he said they would be able to supply energy to two million homes.
Earlier, Lord Bruce of Bennachie, who stood down as Gordon MP at the general election after more than 30 years, said the industry was probably facing its “worst ever crisis”.
The former Liberal Democrat deputy leader called on the UK Government to scrap the supplementary charge.
Lord Bourne said representations had been made “on the fiscal front”, adding: “Absolutely the chancellor will be considering these.”
Labour peer Lord McFall of Alcluith said the tax, imposed in the 2011 Budget, had been increased from 20-32% on the basis oil prices had doubled.
He went on: “They have now crashed from $114 a barrel … to less than $30. There must be a compelling case to scrap that supplementary tax in its entirety and engage with Ian Wood and others once again to ensure in a bleak global environment there is at least some viable future for the North Sea industry.”
Lord Bourne pointed to the £1.3billion “injection of extra help” over five years in last March’s Budget in the form of tax cuts.
