Best is yet to come from North Sea oil says Alex Salmond

First Minister Alex Salmond asserted yesterday that “the best is yet to come” on the value of the North Sea oil industry to an independent Scotland, claiming it would bolster its credit rating in financial markets.

He argued in a speech to the annual convention of the Institute of Directors in London’s Docklands that independence would be good for business and the economy north of the Border.

Salmond, who also heralded a new business marketing campaign launched yesterday by inward investment quango Scottish Development International (SDI), said he accepted that North Sea output was past its peak “with 60 per cent extracted and about 40 per cent left”.

But he added: “In terms of value it’s the opposite.” The First Minister said there was an estimated $2 trillion (£1.5 trillion) of oil to be extracted from the North Sea over the next 40 to 50 years.

“In terms of value, the best of North Sea oil is yet to come. Forty to 50 years is not to be sniffed at,” Salmond said in a related discussion with IoD director general, Simon Walker.

The First Minister said this would help an independent Scotland get strong credit ratings from financial markets, which in recent months have placed pressure on the sovereign capital-raisings of the likes of Greece, Spain, Italy and France.

“Most people would think that [the projected value of North Sea oil reserves] would give you strong collateral for your [credit] ratings. I’m fairly confident we would be triple A rated,” Salmond said.

The First Minister played down his earlier acknowledgement that monetary policy would still be decided by the Bank of England even after any vote for independence, claiming the transfer of far greater fiscal spending power to Scotland was more important.

“Monetary policy is very important. But you can exaggerate the flexibility of monetary policy,” he said. “Fiscal policy in the modern world has primacy. It can set levels of [business] investment.”

Salmond said the new business marketing campaign would see the SDI target 200 of the UK’s biggest businesses that do not have operations in Scotland arguing the benefits from top-quality university education to professional skills.

He told the IoD members that the message would be taken “right to the heart of the City”, taking over the Reuters Digital Billboard at Canary Wharf “where it will be seen by more than 600,000 people per week”.

SDI’s campaign is backed by big companies who already invest in a currently devolved Scotland, including Amazon, GlaxoSmithKline, Mitsubishi and Ceridian.