HC Deb 13 June 1988 vol 135 cc1-2
1. Mr. Key

To ask the Secretary of State for Energy if he will make a statement on the current level of exploration drilling on the United Kingdom continental shelf.

The Minister of State, Department of Energy (Mr. Peter Morrison)

During the first five months of 1988 a total of 75 exploration and appraisal wells were started, compared with only 40 in the same period last year. Exploration well starts alone have risen from 18 in the first five months of 1987 to 27 in the corresponding period this year.

Mr. Key

May I be the first to congratulate my right hon. Friend on becoming a Privy Councillor. That is very good news. Will he have a word with his right hon. Friend the Chancellor of the Exchequer about the models used to calculate the net present value, because some of the oil companies are very concerned about that calculation for the southern North sea? It would he a shame to do anything to disturb the very good upward and upbeat trend.

Mr. Morrison

I am grateful to my hon. Friend for his congratulations. My right hon. Friend the Secretary of State for Energy is not here today because, as hon. Members know, he is leading a very important industrial mission to China.

I have heard the points made by some oil companies. They have discussed them with me. They are very much in favour of the proposals put forward by my right hon. Friend the Chancellor of the Exchequer in many parts of the Budget. However, they have one or two points to make and they are being discussed with me and my right hon. Friend the Chancellor.

Mrs. Margaret Ewing

May I add my congratulations and those of my colleagues in the SNP-Plaid Cymru group to the Minister on the honour that he has received. When does the right hon. Gentleman expect that there will be a spin off to the oil fabrication yards of the renewed activity in the North sea sector, particularly in view of the difficulties at Ardersier?

Mr. Morrison

I am most grateful to the hon. Lady for her remarks. She and one or two other hon. Members put points to me when they came to see me the other day. There is concern about the amount of work available in the fabrication yards. As I said then, the current level of activity—drilling and appraisal—and the number of developments that I have been able to approve this year mean that the outlook for the yards is better than it would otherwise have been.

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