The UK Government and industry could learn from a new book chronicling the history of the North Sea energy industry, Alex Salmond said last night.
Speaking at the official launch of Professor Alex Kemp’s Official History of North Sea Oil and Gas, at Aberdeen University’s King’s College Conference Centre, the first minister said mistakes made in the past should not repeated.
The two-volume history draws on previously untapped government records and provides analysis of oil and gas policymaking from the early 1960s to 1993. It outlines how successive governments changed their policies towards the oil and gas industry and how, more often than not, the reasons were for short-term fundraising.
It also looks at how officials had been slow to recognise the additional funding Aberdeen had to invest in infrastructure to support the industry and also how the city had been sidestepped by government departments preferring to be based in Glasgow. Mr Salmond said: “One of the key lessons from the official history is getting the taxation regime for oil and gas extraction right.”
The first minister said there was still 38% of production to be had in the North Sea but that in value terms there was still 60% left, however, much of that 60% was in smaller fields and to unlock them the right taxation system and stability was needed, he added.
Mr Salmond said lessons learned should be used to support the renewable-energy industry, which he said would have a huge marketplace in Scotland over the next 20-40 years.
Also speaking at the event was George Watkins, former chairman and managing director of ConocoPhillips (UK).
He said that if the UK Government thought that projects such as BP’s multibillion-pound Clair Ridge development going ahead meant the industry was ok, “it would be a dangerous mistake”.
Prof Kemp, professor of oil and gas economics at Aberdeen University, said: “The official history could play an important role in informing future policy decisions regarding the issuing of licences, appropriate taxation for changing operating conditions, and the formulation of decommissioning and safety policies.”
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