That the Norwegian Statoil-led consortium is finally going to get the difficult-to-pump heavy crude out of the Mariner field off Shetland is good news for jobs and revenues to the UK (your report, 22 December).
It is stated that 250 million barrels could be accessed out of 2,000 million down there giving a 30-year life, with quite fast output decline from 2021 after an initial 20 millionbarrels per annum from 2017. This fact – while wholly welcome – emphasises the North Sea oil problem: even new fields don’t last very long. So, relying on all the various fields’ associated income to the state’s coffers is not going to cover expenditures after just a few more years, particularly as those expenditures inexorably increase (blame the pensioners).
This reminder should be attached to every new initiative; they’re all needed but over the long term are not the panaceas promulgated. If only the early-found North Sea oil had not been squandered somewhat fruitlessly while so much UK manufacturing was demolished.
IT IS intriguing to note the coverage of the Centre for Public Policy for Regions report that Scotland’s economy faces significant deterioration in future due to a fall in tax receipts from North Sea oil.
It was especially interesting that it came the day before Norwegian firm Statoil, announced proposals to invest £4.3 billion in a North Sea oil field, bringing hundreds of jobs to the north-east of Scotland. In addition, given Norway’s greater reliance on oil revenue than Scotland, it is clearly not going to be long before the Norwegians will be facing similar dire financial straits to an independent Scotland.
The forecast for Scotland’s financial future is overly pessimistic as the Department of Energy and Climate Change estimates of future oil prices are much more bullish than those in the CPPR report, with 2017 prices predicted to reach $120.
With 24 billion barrels of oil still to be recovered with a wholesale value of £1.5 trillion, the North Sea oil and gas sector has a bright future. An independent Scotland will be able to face the difficult financial choices ahead from a stronger position than in the UK and use the full range of economic levers to support growth, boost revenues and deliver public services.