North Sea Oil

HC Deb 23 February 1972 vol 831 cc1261-6

4. Mr. Douglas

asked the Secretary of State for Scotland if he will make a statement on the meeting between his Department and Scottish local authorities regarding the exploitation of North Sea oil.

The Under-Secretary of State for Development, Scottish Office (Mr. George Younger)

On 14th February I had a meeting with the planning and development authorities principally affected with the aim of identifying and promoting measures to bring the maximum of benefits to Scotland from North Sea oil developments. It was agreed to constitute the meeting as a standing conference which will meet again later this year, under my chairmanship. To back up the standing conference, my right hon. Friend's Department are providing a permanent point of contact to which all concerned with the development of North Sea oil can refer for information or advice.

Mr. Douglas

Would the hon. Gentleman accept that that is a very interesting answer? I am grateful that he is at last taking some initiative to ensure that Scotland gets the maximum possible benefit from North Sea oil. Did this meeting take place without any discussion document prepared by the Department being submitted? Is it the Government's intention to prepare some discussion document, for this House in particular, so that we may know the Government's views on exploiting this very important natural resource?

Mr. Younger

There was not a discussion document for this meeting. The main information at the meeting was a fascinatingly interesting description of the possibilities for exploiting North Sea oil given by the representatives of four major oil companies. All the delegates who took part in the conference found that what they said was most interesting, useful and revealing.

Mr. Wolrige-Gordon

Would my hon. Friend confirm that the oil companies are generally very pleased with the reaction and the help that they have received from the local authorities in the area, and that N.E.S.D.A. in particular has been earning golden opinions, on which I congratulate it? As the present development appears to be very piecemeal, has my hon. Friend formed any view about whether it is wholly desirable to let it continue in that fashion?

Mr. Younger

I warmly support what my hon. Friend said about N.E.S.D.A., whose rôle in this has been of tremendous help to all concerned. As for the exploitation side, it is significant that, even before a single barrel of oil has been brought ashore commercially from any of these finds, already over 1,000 people in Aberdeen have jobs through the exploitation of this resource. The oil companies all say that their experience is that the people of the North East are extremely good and very quick to respond to their needs.

Mr. Grimond

Did the Government promise finance to the local and public authorities for works in connection with this oil? If so, is this to be extra finance, covering such things as housing, as well as harbour and connected works? What will the rate be? Will it be a 100 per cent. grant? If the hon. Gentleman cannot answer these questions now, since they are very important for the public authorities doing the planning, would he say when the financial proposals might be available to the House?

Mr. Younger

What I said to the conference was that the Government recognised that there may well be change in priority in the provision of infrastructure to respond to the needs for North Sea oil. I assured them that the Government knew this and were reappraising the priorities to make sure that they accord with the needs.

16. Mr. Strang

asked the Secretary of State for Scotland if he will make a further statement on his proposals for ensuring that the exploitation of North Sea oil makes the maximum contribution to the Scottish economy.

24. Mr. Wolrige-Gordon

asked the Secretary of State for Scotland what survey he has made of the logistics required for further exploration and exploitation of the oil fields in the North Sea; and if he will make a statement.

Mr. Gordon Campbell

The international oil industry is finding that it will have to apply its most advanced technology to tap this oil because of the difficult conditions, including depths of water. My aim is that as much of the work as possible on platforms, rigs, equipment, services and other related activity should be in Scotland. Already important installations and sites in Scotland are being planned and progress is fast, although the oil is unlikely to start flowing for at least two years.

Mr. Strang

Do the Government intend to publish a coherent and flexible plan for the exploitation of North Sea oil? In the meantime, would the Secretary of State investigate the possibility of moving the headquarters of the petroleum division of the Department of Trade and Industry to Edinburgh, as such a move would not only provide 90 useful jobs but would also have an important beneficial effect on the oil industry in Scotland?

Mr. Campbell

Only one major company has announced its plans for the first phase. The companies themselves are still at the exploration stages, and most of them have not yet been able to put forward plans, so the Government are not yet in a position to come in and co-ordinate. On the question of removing the headquarters of the D.T.I. petroleum division, my right hon. Friend the Secretary of State for Trade and Industry will take note of that suggestion.

Mr. Wolrige-Gordon

Is my right hon. Friend aware that communications will be absolutely essential for the rapid development of the oil industry in the North-East? What particular consideration is he giving to a motorway, which will be necessary not only to Aberdeen but to the north of Aberdeen as well?

Mr. Campbell

All infrastructure, which includes roads, is being considered, with the developing North-East oil industry being fully taken into account.

Mr. Robert Hughes

Would the right hon. Gentleman draw the attention of the Secretary of State for Trade and Industry to the fact that Aberdeen is an eminently suitable place to which to transfer the petroleum division of the D.T.I., instead of many other places? On infrastructure, would the right hon. Gentleman indicate when Aberdeen Harbour Board is likely to get authority to proceed to improve and develop port facilities?

Mr. Campbell

A number of very suitable places along the east coast commend themselves for headquarters of different kinds. I am glad to note that some of the leading companies have made their headquarters in Dundee and Aberdeen, among other places. On the point of the hon. Gentleman's question about infrastructure, that is a matter for my right hon. Friend the Minister for Transport Industries, and I shall ensure that he is aware of the hon. Gentleman's concern.

Sir G. Nabarro

May I, as a Sassenach, ask my right hon. Friend the Secretary of State whether he realises that this major discovery of oil under the North Sea, not far off the coast of Scotland is the greatest bit of luck that Scotland has had this century? Having regard to the outcome of the miners' strike and the urgent need for alternative sources of indigenous fuel on a big scale, the utmost expedition is urged upon him by all Sassenachs to ensure development as rapidly as possible.

Mr. Campbell

Recognising my hon. Friend as a Sassenach who has a great interest in Scotland, I assure him that we regard this not only as a piece of great good fortune for Scotland but also as opening opportunities which we in Scotland must grasp.

Mr. W. Baxter

While we are all most anxious to do what the right hon. Gentleman has indicated and to see the exploitation of this oil, what measures have been taken to safeguard the interests of the fishing industry if, perchance, there should be bursts or breakages in the oil pipes and a great deal of contamination of the sea?

Mr. Campbell

I am glad to say that the companies with whom I have been in touch so far are formulating plans and taking immense trouble to avoid leakages of oil. The fishing industry has expressed some apprehensions, but, being somewhat familiar with both industries, I see no reason why, if they keep in close touch with each other, their operations cannot carry on without interference.

Sir J. Gilmour

Does my right hon. Friend agree that one of the best ways of helping Scottish industries would be for the oil that comes ashore in Scotland to be made available to Scottish industries at a cheaper rate than elsewhere?

Mr. Campbell

That is a very interesting suggestion, and I am sure that my right hon. Friend the Chancellor of the Exchequer will take note of it. As for refining the oil, B.P. has already undertaken an expansion of its refinery at Grangemouth.

Mr. Ross

While we are glad to see that infrastructure needs are being met, will the Secretary of State assure us that they are being met by additional grants rather than by changes in the priorities, as may have been understood by what was said earlier by the Under-Secretary, that additional monies are to be made available in advance and that direct benefits will be taken up later? Has the right hon. Gentleman had any meetings with the Minister more directly responsible for this matter, and the Treasury, to ensure that direct financial benefit will flow into Scotland as a result?

Mr. Campbell

It is certainly the Government's intention, and that of Ministers concerned, that there should be Government assistance at the early stages when it is most required. As the right hon. Gentleman will know, I am attending, on Friday, a conference at Aviemore on the whole question of the North Sea oil industry.