Industry body Oil and Gas UK has hailed the Scottish Government’s multi-million pound backing of a decommissioning fund as a major boost for the struggling supply chain.
The £5million cash pot was unveiled just hours after energy giant Shell announced that it had submitted draft plans to the UK Government over the removal of ageing assets from the North Sea’s Brent field.
Oil and Gas UK chief executive Deirdre Michie has welcomed the fund, which she claims will give a much-needed boost to supply chain companies.
But she also echoed union calls for the industry to strike a balance between preparing for decommissioning and ensuring that every last drop of oil was extracted from the remaining reserves.
She said: “The First Minister’s announcement today of a new £5 million fund to support Scottish companies looking to take advantage of decommissioning sector opportunities is encouraging news for the many supply chain companies still struggling in the downturn.
“Oil and Gas UK looks forwards to engaging with the Scottish Government on how this fund will work once it becomes available in March.
“It’s important that the industry’s focus remains on maximising economic recovery of the UK’s oil and gas while recognising and managing the fact that decommissioning is part of the natural evolution of the UK continental shelf.
“Our forecasts suggest an average of £1.7 billion will be spent on decommissioning in the UK each year over the next ten years and so it is helpful that we should support the UK supply chain to develop its capacity to compete effectively.
“Looking forwards we must ensure key assets are not decommissioned prematurely and that industry continues to deliver decommissioning in a safe, environmentally sound and cost-effective manner with sufficient early planning and co-ordination to enable the UK supply chain to develop competitive industrial capability.”
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