HC Deb 12 January 1976 vol 903 cc7-9
5. Mr. Peter Morrison

asked the Secretary of State for Energy whether he is satisfied with the proposed levels of oil production from the North Sea for the year 1976.

18. Mr. Viggers

asked the Secretary of State for Energy if he will make a statement on the development programme for offshore oil and gas.

The Minister of State, Department of Energy (Mr. John Smith)

The development programme for offshore oil and gas is proceeding on the lines described in the 1975 Brown Book. The oil produced in 1976 will enable us to make a significant reduction in our oil imports.

Mr. Morrison

Is the Minister aware that the level of oil production in 1976 and thereafter would be significantly higher if the present uncertainty over the 51 per cent. stake did not exist? When will the Government wake up and realise that it is their policy—a Socialist policy—that is having such a damaging effect on North Sea oil production?

Mr. Smith

Exactly the same comments were made by Conservative Members while the taxation system for the North Sea was being discussed and while the regulatory system under the Petroleum and Submarine Pipe-lines Act was being discussed. Conservative Members are still trying, for ideological reasons, to make out that participation is an obstacle to development in the North Sea. Participation is an essential way in which the national interest can be controlled and developed.

Mr. Viggers

When is the next round of licensing to take place? Will the Minister repeat the assurance that there will be no compulsion on companies to yield to the Government 51 per cent. of their interest in the North Sea?

Mr. Smith

My right hon. Friend the Secretary of State made clear last September that there would be a licensing round this year. We hope to invite applications in the fairly near future and perhaps award licences towards the end of the year. It has been made clear all along that the participation negotiations are voluntary.

Mr. Gwilym Roberts

Will my hon. Friend discuss with my right hon. Friend the Secretary of State for Industry the full effect that the flow of oil is likely to have on industrial investment, to ensure that by the end of the year industry is geared for the upturn that some of us expect?

Mr. Smith

That is a matter for my right hon. Friend the Chancellor of the Exchequer. I shall draw my hon. Friend's comments to his attention.

Mr. Gray

Do the Government realise that it is as a direct result of their policies that investment is now being denied to many North Sea projects, and that this is nowhere more obvious than in the platform building industry, in which there is great alarm over the scarcity of orders?

Mr. Smith

There is a problem about timing in regard to platform orders and orders for associated equipment. The Government have taken steps to make sure that this country has sufficient capacity to meet the orders that are likely to come. We believe that important orders will be placed in the coming year. Opposition Members have never been able to demonstrate convincingly a causal connection between the Government's policies and the present situation.