North Sea Gas (Hansard, 12 December 1967)

§ 3. Mr. Gwilym Roberts
asked the Minister of Power if agreement has been reached on the price of North Sea gas; and if he will make a statement.

§ 50. Mr. William Hamilton
asked the Minister of Power what reply he has given to the request made by companies engaged in the North Sea gas project for increased prices consequent on devaluation.

§ Mr. Marsh
No agreement has yet been reached on the price of North Sea gas.

§ Mr. Roberts
Would not my right hon. Friend agree, however, that if the price charged is in excess of 2d. per therm it will make it uneconomic for many industrial and chemical purposes? Will he at this stage say that under no circumstances will he accept a price in excess of that figure?

§ Mr. Marsh
If my hon. Friend really expected a full answer to that question, all I can say is that he has an enviable level of optimism. I think that this is a very complex subject, rather more complicated than my hon. Friend has presented it. Clearly there will be no purpose in purchasing North Sea gas at a price at which it is not viable.

§ Mrs. Thatcher
Can the right hon. Gentleman say whether a revised application has been received consequent on devaluation?

§ Mr. Marsh
Not yet. The companies are reworking their calculations, and we are in fact reworking ours.

§ Mr. Neal
Will my right hon. Friend assure the House that this argument about prices is not depriving consumers of early participation in the use of North Sea gas?

§ Mr. Marsh
My hon. Friend has raised a very important point. There is no evidence that this is holding up supplies or development. Gas is coming ashore, and development is continuing, but clearly both sides are faced with a new situation in which they have to re-do some of their calculations.

§ 4. Mr. Gwilym Roberts
asked the Minister of Power if he is satisfied that the cost to the developers of extracting North Sea gas was more than 1½d. a therm, spreading exploration and development costs over a 20 year period and a 10 year period, respectively; and what estimates he has of these costs.

§ Mr. Marsh
As I explained to my hon. Friend on 4th July, cost estimates made by my Department are confidential. —[Vol. 749, c. 205.]

§ Mr. Roberts
But would not my right hon. Friend agree with me that as the developers must know these figures already, there is nothing to hide, and surely the general public who have to pay the piper are entitled to know what it costs the companies to develop this gas?

§ Mr. Marsh
I think the companies will feel that there is a great deal to conceal from each other. The cost details are commercial secrets. They are given to the Department in the strictest confidence, and the companies would not want one another to know some of the details.
The other point which my hon. Friend must get clear is that some of these costs have not yet been incurred. The costs will be in respect of fields which have not been found, much less developed.