Oil Supplies (Hansard, 6 July 1981)

§ 3. Mr. Chapman
asked the Secretary of State for Energy if he will make a statement on the latest assessment of prospects for new discoveries of oil whether on land in the United Kingdom or beneath the continental shelf.

§ The Minister of State, Department of Energy (Mr. Hamish Gray)
My right hon. Friend's report to Parliament on the development of the oil and gas resources of the United Kingdom in 1981 estimated future finds at between 775 million and 1,775 million tonnes. Until much more exploration has taken place it is not possible to assess the possible oil-bearing potential of the United Kingdom onshore areas.

§ Mr. Chapman
How much of that increase is due to on-land discoveries rather than to discoveries beneath the continental shelf? Will my hon. Friend give an assurance that the on-land discoveries made so far will pose no major environmental problem?

§ Mr. Gray
I cannot give my hon. Friend the onshore figures. There has not yet been sufficient exploration carried out to assess the potential. I can, however, say that since coming to office the Government have issued 57 new exploration licences permitting geological exploration work and 19 new production licences onshore. In regard to environmental hazards, I can confirm that all applications are subject to normal planning controls and are carefully monitored.

§ Mr. Penhaligon
Is the Minister aware that over the past five or six years my part of the country has been speculating constantly about the great oil exploration boom that is about to hit the South-West? To date, little seems to have happened. Does the Minister believe that anything ever will happen, and can he predict when it will start?

§ Mr. Gray
The hon. Gentleman will be aware that blocks have been offered in the Channel and the Western Approaches. There has been enthusiasm from the companies. There is also onshore interest in that part of the country, but the possibilities will depend on geological factors now being explored.

§ Mr. Gordon Wilson
I accept that exploration is necessary, but does the Minister accept that the current and medium-term problem will be over-production? Will he confirm or deny reports in the Financial Times today that the Government are at last considering a real depletion policy?

§ Mr. Gray
I take issue with the hon. Gentleman when he refers to a real depletion policy. The Government announced their depletion policy a year ago. They have been following this policy carefully, to such purpose that, for example, the amount of wasteful gas flaring in the North Sea has been reduced by 50 per cent. since 1979. Another aspect of the depletion policy involved a delay of two years on the Clyde field. The Government's depletion policy is working satisfactorily and will, we hope, continue to do so.

§ Mr. Patrick McNair-Wilson
Is my hon. Friend aware that last Friday, three days before the Hampshire county council was due to discuss the application of Shell (U.K.) Exploration and Production to drill in the New Forest, the Secretary of State for the Environment called in the application for consideration, following a public local inquiry? Can my hon. Friend tell the House whether that decision marks a determination by the Government to strike an overall balance between the nation's energy requirements and the environmental considerations, which must be significant in an area such as that which I represent, particularly in the context of onshore exploration for oil, gas and coal.

§ Mr. Gray
My hon. Friend will appreciate that this is a matter for my right hon. Friend the Secretary of State for the Environment. It confirms the Government's determination to give full and fair consideration to all the aspects which govern such a decision.

§ Mr. Rowlands
If, as the Minister says, the Government do not possess an accurate assessment of onshore oil possibilities and reserves, how can an accurate evaluation be placed on Wytch Farm? Will the Minister reconsider the Government's intention to pursue the hasty sale of this important oilfield, in the light of the fact that the full exploration possibilities at the Wytch Farm field are not even known?

§ Mr. Gray
Wytch Farm is one of the exceptions to the rule. Oil has been found. It is possible to make an accurate assessment. Normal commercial values will place a valuation on the field.