§ The Minister of Power (Mr. Frederick Lee)
With your permission, Mr. Speaker, and that of the House, I wish to make a statement.
I hope to be in a position early next month to invite applications for further production licences to search for and get oil or gas on the Continental Shelf.
The territory on offer will include blocks which were offered on the last round, but were not taken up, and certain areas which have recently become available in territorial waters. In addition, subject to the approval by Her Majesty of an Order-in-Council designating additional parts of the Continental Shelf, I hope to offer further blocks in a strip between the edge of the present designated area in the North Sea and the boundary with the Norwegian, Danish and Dutch parts of the shelf; in an area about 10 to 20 miles wide around the South Coast from Dover to Teignmouth; in the Eastern half of the Irish Sea; and in an area extending round the Orkneys and Shetlands.
I will arrange for a map to be placed in the Library showing the areas within which blocks will be offered.
The royalties and other financial terms applicable to licences will be unchanged.
I turn now to the considerations I shall have in mind in awarding licences. In the Government's view, the overriding objective is to secure the most thorough and rapid exploration and development of the oil and gas resources of the Continental Shelf in the national interest. I shall, therefore, consider all applications which can contribute to this end; and shall pay particular attention to the programme of work proposed and the capacity of the applicant to carry it out. I shall also take into account any exploration work already done by or on behalf of the applicant which is relevant to the areas applied for, and his facilities for disposing, in this country, of any oil or gas won.
1580 As required by the regulations, all applicants must be citizens of the United Kingdom and Colonies resident in this country or bodies corporate incorporated in the United Kingdom, and the profits of the operations will be taxable here. Where the applicant is a foreign-owned concern, I shall look at the extent to which British companies receive equitable treatment in that country. Other things being equal, however, I intend to give weight to the contribution which the applicant has made or is planning to make to our economic prosperity, including the strengthening of the United Kingdom balance of payments and the growth of industry and employment in this country, with particular reference to regional considerations.
I shall also take into account any proposals which may be made for facilitating participation by public enterprise in the development and exploitation of the resources of the Continental Shelf.
§ Mr. Peyton
Is the right hon. Gentleman aware how welcome this statement is, and will he accept that the Opposition wish to congratulate him on the very close way in which he has followed the line taken by the previous Administration? Does he recall the words used by the right hon. Gentleman the First Secretary of State towards the end of last year, in which he accused the Conservative Government of dishing out taxpayers' property to their private enterprise friends? Will the right hon. Gentleman be good enough to convey the sympathies of the Opposition to his right hon. Friend the First Secretary of State whose face must be exceedingly red at this moment?
§ Mr. Lee
It is a pity that, at eleven minutes to four this afternoon, the hon. Gentleman's thinking on this is no better than it was at one o'clock this morning. In fact, my party welcomed wholeheartedly the Bill which was introduced by the Conservative Government.
On the Second Reading of the Bill, my right hon. Friend the Minister of Transport said:I congratulate the Minister on bringing forward the Bill, because we on this side of the House appreciate its urgency. I think that we might well have had it a little earlier".A little later he said:I congratulate the right hon. Gentleman also, on having introduced a Bill which so 1581 extends public ownership without, so far, a murmur of protest from any corner of the House. I shall be interested to know whether any hon. Member opposite intends to protest at the Minister's efforts as one of the great nationalisers".—[OFFICIAL REPORT, 28th January, 1964; Vol. 688, c. 224–5.]The statement which I have made goes much further than the statement of my predecessor, but I think that he forgot to mention participation by the nationalised industries.
§ Mr. Grimond
Can the Minister tell us a little more about what is meant by the phrase in his last but one sentence,with particular reference to regional considerations"?Does that mean that he expects some employment to be given in the regions concerned? Could he also tell us whether he has reason to suppose that these licences will in fact be taken up?
§ Mr. Lee
A real increase in employment in shipyards is now going on as a result of building the rigs, which is employment worth many millions of pounds. It so happens that it is largely in the development districts and is of great importance to those particular areas. I have forgotten the right hon. Gentleman's second point.
§ Mr. Hector Hughes
Is the Minister aware that since drilling started in the North Sea there have been complaints of a diminution of the fishing potentialities? Will he say what steps he takes, under the licences he grants to drillers, to protect fish and the fishing interests from that diminution? Secondly, as these sites are islands, as the Minister has said, based upon the shelf of the North Sea, what steps is he taking to protect Britain from adverse use of those islands by means of radio or television or in the event of war?
§ Lady Tweedsmuir
Would the Minister say whether one of the criteria that he will take into account in granting further licences will be that the work in connection with drilling rigs or any shore installations must be in development districts, notably the North-East and the City of Aberdeen? Secondly, would he also give a progress report on the exploration to date and tell us how far it has been successful?
§ Mr. Lee
As I said to the right hon. Member for Orkney and Shetland (Mr. Grimond) just now, we are very keen to get a greater allocation of orders for rigs, and so on, in the development districts especially. I have in mind the North-East and areas of that type. To date, I think that there three wells have been drilled and that three are in the course of drilling. So far, I have nothing to report about what has been found.
§ Colonel Lancaster
Is the right hon. Gentleman aware that during the passage of the Continental Shelf Bill his right hon. Friend the Minister of Transport criticised very strongly the proposals of the Conservative Government for the allocation of licences? What has happened in the thinking of the Ministry now to reverse that view and to adopt the procedure which the Conservative Government on that occasion put forward as the suitable one?
§ Mr. Lee
As I said in answer to the hon. Member for Yeovil (Mr. Peyton), we want to sub-divide this. My right hon. Friend the Minister of Transport wholeheartedly welcomed the Bill itself as a very worth-while and healthy extension of nationalisation.
During the course of the election campaign, when the previous Government, which had been nearly dead for two years was undoubtedly a dead duck, they rather jumped the gun by issuing licences. I endorse everything my right hon. Friend the First Secretary and my right hon. Friend the Minister of Transport said.
§ Mr. Dalyell
Hon. Members who served on the Committee stage of the Continental Shelf Bill will welcome my right hon. Friend's statement of good 1583 will. But in the light of his previous statement in relation to the Coal Board running down in areas where there are problems in the extractive industry, could he take positive steps to suggest to the Board that it might take an interest along these lines?
§ Mr. Hugh D. Brown
Is there anything in the existing agreement on the issuing of licences that obliges an unlucky prospector to make the information that he has already obtained available to a competitor? It seems to me to be highly desirable in the national interest that this information should be made available.
§ Dame Irene Ward
On a point of order. In view of the fact that my constituency was mentioned, and that both the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) and my hon. Friend the Member for Aberdeen, South (Lady Tweedsmuir) have asked supplementary questions, is it not odd that my constituency is not allowed to have a look in, Mr. Speaker?
§ Mr. Speaker
I share the hon. Lady's distress on all occasions. There is nothing odd about it. We have to bear in mind that we are invading private Members' time.
§ Dame Irene Ward
I will try again. I am asking whether it is not rather unusual, when my constituency is one of the key constituencies mentioned for this new development, that my part of the country is not allowed to have a single question put in relation to this very important part of the North-East Coast. I have had to rely on the right hon. Gentleman the Member for Orkney and Shetland (Mr. Grimond) and my hon. Friend the Member 1584 for Aberdeen, South to ask about my constituency? It is not fair.
§ Mr. Speaker
I wish that I could say it was not unusual. Hardly ever a day passes that I bring these discussions to an end when I think that I have to—
§ Mr. Speaker
—do my best to be fair to everyone without vigorous protest from some quarter or another. I have to be hard-hearted about that.
§ Mr. Thorpe
On a further point of order. Is it not a fact that the reference was not to Tynemouth, but to Teignmouth?
§ Mr. Speaker
I would beg the House not to be unduly frivolous about this. We are consuming private Members' time, which is limited to seven o'clock.