Report warns Indyref2 uncertainty threatens oil and gas jobs

Deputy Leader of the SNP Stewart Hosie during the SNP Spring Conference. Picture: Getty
Deputy Leader of the SNP Stewart Hosie during the SNP Spring Conference. Picture: Getty
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Uncertainty caused by the threat of a second referendum is putting jobs and investment in the North Sea at risk, a new report has said.

The report by Edinburgh-based analysts Wood Mackenzie (WoodMac) warns “new investment and jobs” are at stake.

The price of oil had made Scotlands financial position more difficult since the independence referendum in 2014. Picture: PA

The price of oil had made Scotlands financial position more difficult since the independence referendum in 2014. Picture: PA

The report states that prospects for the future tax take are being overshadowed by questions about who will subsidise decommissioning liabilities.

WoodMac points to 11 billion barrels of oil equivalent (boe) lying in Scottish waters. There is also an obligation to break up the majority of fields, equating to 80 per cent of the total UK decommissioning bill.

The report said: “Critically, political uncertainty could deter investors from committing to new projects. With new investment and jobs at risk, and the complicating factors of boundaries and decommissioning tax relief, much is at stake.”

WoodMac states that “since the 2014 referendum, commercial reserves have decreased by about 30 per cent”.

It added: “Companies will be looking for reassurances that, should Scotland vote for independence, they will continue to have access to the decommissioning tax relief they currently receive.”

The report was published while questions continued to be asked about the currency that would be used by an independent Scotland.

At the SNP conference in Aberdeen, the party’s Treasury spokesman Stewart Hosie said the option of using sterling was “not as strong an option” as it was in 2014.

Labour’s economy spokeswoman Jackie Baillie said: “This is more currency chaos from the SNP. Stewart Hosie appears to have sent a strong signal that the SNP wants to ditch the pound.”

SNP MSP Gillian Martin responded to the oil report saying: “The only ones causing uncertainty are the Tories, by trying to undemocratically block and delay a referendum – on top of the uncertainty they have caused with Brexit.”