Why North Sea oil and gas companies are vital in fight against climate change

The Brent Charlie oil rig is towed into the mouth of the River Tees as it heads for dismantling (Picture: Ian Forsyth) | Getty Images

A new report claiming that only seven out of 87 North Sea offshore oil and gas companies have plans to invest in renewable energy by 2030 speaks to an issue that is fundamentally important to not just Scotland’s but the UK’s economic future.

According to the Office for Budget Responsibility, oil and gas tax revenues will total an estimated £3.8 billion in this financial year. The sector also employs 23,000 people in Scotland and indirectly supports many more.

The loss of such an industry would clearly be a devastating blow. And, given the North Sea’s dwindling fossil fuel reserves and the need to move towards a net-zero emissions economy to tackle climate change, we know this blow is coming.

Fortunately, there is a chance to at least partially offset the damage by building a sizable renewable energy industry – because of the abundance of wind energy, in particular, around Scotland’s coasts and the marine engineering skills developed in the North Sea oil industry.

‘Guiding hand’ of free market

Offshore Energies UK, which recently changed its name from Oil and Gas UK to reflect the changing nature of the industry, said the research presented only a “narrow snapshot” and “misses the bigger picture”. However, it is probably fair to say there could be more hard evidence of major oil companies getting involved in renewables.

The Brent Charlie oil rig is towed into the mouth of the River Tees as it heads for dismantling (Picture: Ian Forsyth) | Getty Images

When the ‘guiding hand’ of the free market fails to lead us in the right direction, governments can and should intervene in a sensible and measured way. Persuading North Sea oil and gas companies to become part of this great new industrial endeavour should be a priority for ministers.

GB Energy, the Aberdeen-based, publicly owned company planned by the UK Government, will hopefully become a practical enabler of the process, with its promises to “invest in clean energy across our country, and make the UK a world leader in floating offshore wind, nuclear power, and hydrogen”.

North Sea oil and gas may be in decline, but the ‘offshore energies’ industry most definitely has a future, if only the companies involved and we as a nation will grasp it.