North Sea Oil

HC Deb 10 November 1975 vol 899 cc893-8

1. Mr. Peter Morrison

asked the Secretary of State for Energy what is his present estimate of the yield of oil from the North Sea in 1976, 1977 and 1978; and how this compares with official estimates made two years previously.

The Secretary of State for Energy (Mr. Anthony Wedgwood Benn)

The Government's estimates are indicated in the table on page 16 of the Brown Book. For the years mentioned, these represent a reduction as compared with the 1973 forecast because of the over-optimistic view then taken of the time necessary to bring fields into production.

Mr. Morrison

Is the Secretary of State aware that, because of the Government's uncertainty over the terms of participation in the oilfields, development in the smaller oilfields is being held up and that this is resulting in a run-down in the fabrication yards, the net result of which is bound to mean even greater numbers of unemployed?

Mr. Benn

The problems to which the hon. Gentleman refers are real, but the truth is that the estimates made in 1973 did not take account of the difficulties facing the offshore operators and have nothing whatever to do with the other factors mentioned by the hon. Gentleman.

Mr. Gordon Wilson

Is the Secretary of State aware that in the most recent World in Action poll it was shown that, based on that sample, two-thirds of the Scottish people wish all or most of Scottish oil resources to be used for the benefit of the Scottish people through the Scottish Assembly? Will the Secretary of State comment on the implications of that sample poll on energy policy, particularly in view of the fact that self-sufficiency in Scottish terms is likely to be achieved by the late spring? Does the right hon. Gentleman concede that his Department's policies will have to change to accord with that situation?

Mr. Benn

I am responsible for many things but not for World in Action public opinion polls or the assertions of the hon. Gentleman. I think that everybody recognises that what we want is to get control of our own resources, as far as possible. The policy that we are putting forward, which I hope both Houses of Parliament will pass this week, will help us in that intention. The benefits in Scotland, in terms of the number of jobs and opportunities, quite apart from the benefits that will flow from the oil to the people in Scotland, will be real.

Mr. Robert Hughes

Does my right hon. Friend accept that his recent agreement with the oil companies on a greater share of work being given to British companies has been well received throughout the country, and especially in Scotland? Will he confirm that if the Scottish National Party's disastrous policy of a low depletion rate for North Sea oil were to be followed the Government would have to tell the people of Scotland that it would mean a drastic loss of jobs? We want oil-assured jobs and prosperity for the whole country.

Mr. Benn

I am grateful to my hon. Friend for his reference to the memorandum of understanding, although the main credit for that must go to my hon. Friend the Under-Secretary.

On my hon. Friend's general point, it is not for me to interpret Scottish opinion, but from my Scots half-blood connection, and considerable knowledge, I should be surprised if the Scottish people wanted to separate themselves from the people of England. I think that both peoples would be the sufferers were that course to be urged.

Mr. Patrick Jenkin

Did not my hon. Friend the Member for City of Chester (Mr. Morrison) make a valid point, namely, that the uncertainty which the Government have created by their policy of participation and the setting up of the BNOC is leading directly to a loss of jobs in the fabrication yards in Scotland? Will the right hon. Gentleman have the grace to recognise that fact, even if he cannot do much about it?

Mr. Benn

The right hon. Gentleman has done his best to create uncertainty, and, because he says that there is uncertainty, he asks me to believe that what he says is correct. It is not correct. We are remedying the betrayal of the national interests by the Conservative Government when they had responsibility for oil matters.

16. Mr. Skeet

asked the Secretary of State for Energy what discussions he had with the Japanese Government about Japanese participation in the development of the North Sea oilfield.

Mr. Benn

In the course of a visit to Japan last month, I took the opportunity of meeting several members of the Japanese Government. My informal exchanges with them included North Sea oil, among other topics.

Mr. Skeet

The Secretary of State has not disclosed very much. Did he make a deal with the Japanese that Japanese exploration could take some interest in the North Sea? Did he discuss arrangements under which the Japanese could import crude oil from the United Kingdom? Did he recruit Japanese capital from the banks of the chemical industry? Finally, what is the position of the National Iranian Oil Co. in all this?

Mr. Benn

I think the hon. Gentleman knows that the next round of licences which has been forecast has not yet been announced in detail. I made it clear to the Japanese that there would be no discrimination against foreign companies applying for licences in the next round. It would have been quite wrong for me to anticipate the discussions. But the Japanese are very interested in this matter, as the hon. Gentleman knows. If I remember the figures aright, 73 per cent. of all Japanese energy is oil, and 99.7 per cent. of the oil they use is imported. The Japanese estimate that they will need to double their consumption of oil over the next few years, so their interest in the North Sea is very strong. [Interruption.] I made it clear that we should be making available further blocks for licensing, and they expressed an interest in it. I told them that there would be no discrimination against them.

Mr. Patrick Jenkin

Is the right hon. Gentleman aware that what he is saying now about Japanese investment in United Kingdom oil is in marked contrast to what his predecessor said on 4th November last year, when he roundly condemned my right hon. Friend the Member for Sidcup (Mr. Heath) because we had even so much as talked to the Japanese about investing? Will he disown his right hon. Friend, and confirm that there has been a change of Government policy in this matter?

Mr. Benn

No, certainly not. Indeed, if the right hon. Gentleman looks in Hansard he will find that when I was Opposition spokesman I made exactly the same criticism—that we believed that the previous Government, by linking Japanese investment in industry generally with a pledge to the North Sea, were making a wrong decision. Therefore, what my right hon. Friend my predecessor as Secretary of State for Energy said was right, and the approach that we are making on this is correct, too. When the licensing round is opened, there will be no discrimination against those who wish to apply for licences.

19. Mr. Canavan

asked the Secretary of State for Energy what is the estimated flow of oil from the Forties Field over the next 12 months at the latest date for which the figure is available.

The Under-Secretary of State for Energy (Mr. John Smith)

BP estimates 1976 production from the Forties Field at a daily average of about 200,000 barrels. The precise quantities will depend on progress with development drilling on all four platforms, only one of which has so far been commissioned.

Mr. Canavan

Does my hon. Friend agree that the start of oil flow from the Forties Field is a tribute to the public enterprise of British Petroleum, a company which is 70 per cent. in public ownership? But did my hon. Friend notice that at the opening ceremony last Monday there were representatives of the Tory Party and the Scottish National Party? Does he not think it strange that such Right-wing opportunists should jump on the bandwagon in view of the fact that certain Tory extremists tried to wreck the British National Oil Corporation, and certain Scottish nationalist extremists attempted to blow up the Forties pipeline?

Mr. Smith

I am sure that the whole House will agree that British Petroleum showed immense enterprise in bringing this field on to production. I am glad to say that I have no ministerial responsibility for those who were invited to the ceremony, since it was a matter for British Petroleum, nor have I ministerial responsibility for opportunism on the part of anybody.

Mr. Henderson

Is the Under-Secretary aware that I was one of the Members who had the pleasure of seeing Scotland's oil come ashore a few days ago? Is he also aware, and can he point this out to his hon. Friends, for whom I am sure he has no ministerial responsibility, that within a few months the arrival of oil in Scotland from the Forties Field will make Scotland self-sufficient in oil products? Will he explain to us when we shall see the benefit to Scotland from this?

Mr. Smith

There are considerable benefits flowing from the exploitation of North Sea oil. The hon. Gentleman, some of whose constituents are involved in this, already knows that and ought to pay credit to it. It is not Scottish oil. It is British oil. It belongs to the whole of the United Kingdom and its benefits should accrue to the whole of the United Kingdom. What I find surprising is the definite and embarrassed silence of the Scottish National Party when the Shetlands put forward a claim that is as justified as that of Scotland.