THOUSANDS of new energy jobs are expected to be created by a record-breaking licensing round for North Sea oil and gas drilling.
The UK Government received 224 applications for 418 offshore blocks following the multibillion-pound boost the industry was given in the Budget. The total is the biggest since offshore licensing began in 1964, and 37 more than the previous high in the last round in 2010.
The figures were revealed on the day that a leading oil industry expert hailed plans for an offshore windfarm near Aberdeen. Prof Alex Kemp said the European Offshore Wind Deployment Centre had the potential to make Scotland “leaders in offshore wind”.
Peter Buchanan, chief executive of Valiant Petroleum, said the interest in the North Sea basin was “very positive”. “This points to a continuation of the resurgence of interest in the North Sea. The Budget has helped on a number of fronts with regards to making smaller opportunities more attractive,” he said
Mr Buchanan, who is also chairman of Brindex, the Association of British Independent Oil Exploration Companies, said Valiant had applied for a number of licences and he was “excited” about the opportunities. “Hopefully these licences will translate into actual exploration wells being drilled, which is the ultimate test,” he said.
Chief Treasury Secretary and Highland MP Danny Alexander said: “This is good news for the north of Scotland and will provide a big boost to the economy.
“It also shows that the action we took in the Budget to deliver certainty for investors is delivering results. On the day we’ve also seen a significant fall in inflation, this will be a welcome news for many families.”
According to recent research by industry body Oil and Gas UK, spending in the North Sea is expected to rise to £11.5billion this year, from £8.5billion in 2011.
Mike Tholen, its economics director, said: “The record number of applications is very welcome news which reflects the vast opportunity for business that remains on the UK Continental Shelf.”
Matt Taylor, spokesman for BP, said: “This is encouraging news and reinforces BP’s own view that there is a lot of remaining potential in the UK North Sea. There is also a lot of hard work required if the industry and government is to deliver on this potential – recovering more oil from existing assets, investing in the key infrastructure to improve reliability and delivering the various major projects currently being worked on are all very important.”
Martin Ewan, partner in legal firm Pinsent Masons’ energy and natural resources team, said the licensing announcement was excellent news for companies operating in UK waters. He said: “This announcement puts to bed the tired old argument that the North Sea is dying and is on the critical list.
“It highlights a continuing confidence by large and small exploration and production firms that the UK Continental Shelf is a basin worth investing in and the spin-off will be the creation of potentially thousands of new jobs.
“It is great news for all of us working in the North Sea energy sector and a real boost for the north-east and Scottish economies which will reap the benefits as this investment ripples along the supply chain.”
The UK oil and gas sector supports about 440,000 jobs, with 200,000 north of the border – most of them in the north-east.
UK Energy Minister Charles Hendry said: “There remains an extraordinary level of interest in North Sea oil and gas and it is tremendous news for industry and the UK economy. We have been working hard with the oil and gas industry to ensure the UK remains an attractive place to invest. The Budget was an important step to create a fiscal environment for North Sea development to flourish, providing energy security and jobs.”
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