HC Deb 12 March 1968 vol 760 cc1168-70
6. Mr. Lane

asked the Minister of Power when he expects that an announcement will be made about the price to be paid by the Gas Council for North Sea gas.

51. Sir G. Nabarro

asked the Minister of Power whether he will now make a statement on the price to be paid by the Gas Council and other consumers for North Sea gas.

Mr. Marsh

I would refer the hon. Members to the statement I made to the House on Wednesday, 6th March.—[Vol. 760, c. 458.]

Mr. Lane

As to any future price fixing, will the Minister confirm, as he implied in his statement last week, that his view of a reasonable price is one which is low enough to ensure that the economy gets the full benefit of cheap indigenous fuel and at the same time high enough to encourage companies and consortia to explore new areas thoroughly?

Mr. Marsh

Since I said it last week, I see no reason to disagree with it this week.

Sir G. Nabarro

Having regard to the fact that the settlement announced so far between Phillips and the Gas Council covers only a relatively very small part of the discoveries so far, can the Minister tell the House when he expects to reach a general settlement on the much larger area of discoveries not yet announced for pricing?

Mr. Marsh

Yes, I think the hon. Member will agree that it is not a very small proportion of the total so far found, but a small proportion. The length of time in reaching agreement with the Gas Council and other companies is something which I cannot forecast.

Mr. McGuire

Can my right hon. Friend now say what was the agreed devaluation price put on the price and to what were the companies asking him to agree?

Mr. Marsh

No, Sir.

Mrs. Thatcher

As the price agreement must have been reached before the loss of the latest rig, would the Minister assure the House that that particular price is not to be regarded as a ceiling for other price arrangements?

Mr. Marsh

I cannot quite follow the hon. Lady about the significance of the loss of the rig, which was of course a tragedy.

Mrs. Thatcher

May I perhaps elucidate my supplementary question and stress the increased risks of exploration in the North Sea and the fact that the price may not be higher?

Mr. Marsh

We have always been aware that the risks of exploration in this particular area are very high indeed. This is the justification for the sort of levels of return that no other company would expect to get when operating in normal commercial circumstances.

26. Sir J. Eden

asked the Minister of Power whether he will take steps to set up a free market in North Sea gas.

Mr. Marsh

No. The supply of North Sea gas is subject to the provisions of Section 9 of the Continental Shelf Act, 1964.

Sir J. Eden

To what extent does the right hon. Gentleman expect to see variations in the next phase of the agreed contract prices? What will be the principal factors likely to govern these variations?

Mr. Marsh

I presume that the hon. Gentleman means future agreements. The factors which affect the price will, of course, depend on the different situations in the different fields for the different companies.

Mr. Concannon

Is my right hon. Friend aware that already 20 million tons of coal are being sold to the C.E.G.B. at this particular price?

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