HC Deb 13 July 1987 vol 119 cc691-2
5. Mr. Douglas

asked the Secretary of State for Energy if he will make a statement on the current level of production of North sea oil and gas.

Mr. Peter Morrison

North sea oil production in May was 2.6 million barrels per day, the same level as last year. United Kindom gas production has increased over the past few years and in May production was 3.2 billion cu ft per day.

Mr. Douglas

Would the Minister care to comment on how much the 130 million tonnes of oil production exceeds our requirement? Will he take a little look at the future and especially at balancing the needs of the British and especially the Scottish economies to secure employment with the oil and gas reserves available in the North sea? There is considerable well-founded speculation that the Brown Book figures underestimate oil and gas reserves by about 50 per cent. Would the Minister care to comment on that, because these issues are of particular importance to Scotland?

Mr. Morrison

Having looked back, I know that the hon. Gentleman has followed the industry and production on the United Kingdom continental shelf very closely. If I infer correctly from his question, he is asking for a depletion policy. I hope the hon. Gentleman agrees that, on current prices, that policy is more academic than practical.

Mr. Kennedy

What steps, if any, does the Minister's Department propose to take, or to encourage the Treasury to take following the feed-through effect of the welcome, if somewhat overdue, tax changes in this year's Budget? By the time those tax changes work through there is liable to be a gap or sag in the available contracts into 1988 for all the United Kingdom oil industry fabrication yards. Can further steps be taken by either the Department of Energy or the Treasury to ameliorate the effects next year, which will be a very rough year?

Mr. Morrison

As the hon. Gentleman will appreciate, my Offshore Supplies Office is closely in touch with the companies to which he referred. I think that we have a good and close working relationship with them. I have made it clear that I shall keep closely in touch on their behalf with my right hon. Friend the Chancellor of the Exchequer.

Mr. Rowlands

Does the Minister still believe his predecessor's prediction that we will be self-sufficient in oil until the year 2000?

Mr. Morrison

If the hon. Gentleman had had the misfortune to listen to me in Glasgow two weeks ago at precisely the same hour on the same day, answering the same questions——

Mr. Rowlands

Answer the question.

Mr. Morrison

I shall answer the question. I explained then to an audience and an interviewer that to make predictions of that sort, even if one were an oil economist of the highest level, would be dangerous.