HL Deb 21 July 1965 vol 268 cc751-4

4.22 p.m.

THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE, HOME OFFICE (LORD STONHAM)

My Lords, I apologise to the noble Marquess for this further delay before he makes his maiden speech, but I hope that it will be convenient to your Lordships if I repeat to the House a Statement which has just been made in another place by my right honourable friend the Minister of Power. I will use his actual words:

"I hope to be in a position early next month to invite applications for further production licences to search for and get oil or gas on the Continental Shelf.

"The territory on offer will include blocks which were offered on the last round but were not taken up, and certain areas which have recently become available in territorial waters. In addition, subject to the approval by Her Majesty of an Order in Council designating additional parts of the Continental Shelf, I hope to offer further blocks in a strip between the edge of the present designated area in the North Sea and the boundary with the Norwegian, Danish and Dutch parts of the Shelf; in an area about 10 to 20 miles wide around the South coast from Dover to Teignmouth; in the Eastern half of the Irish Sea; and in an area extending round the Orkneys and Shetlands. I will arrange for a map to be placed in the Library showing the areas within which blocks will be offered.

"The royalties and other financial terms applicable to licences will be unchanged.

"I turn now to the considerations I shall have in mind in awarding licences. In the Government's view, the overriding objective is to secure the most thorough and rapid exploration and development of the oil and gas resources of the Continental Shelf in the national interest. I shall, therefore, consider all applications which can contribute to this end, and will pay particular attention to the programme of work proposed and the capacity of the applicant to carry it out. I shall also take into account any exploration work already done by or on behalf of the applicant which is relevant to the areas applied for, and his facilities for disposing—in this country—of any oil or gas won.

"As required by the regulations, all applicants must be citizens of the United Kingdom and Colonies resident in this country, or bodies corporate incorporated in the United Kingdom, and the profits of the operations will be taxable here. Where the applicant is a foreign-owned concern, I shall look at the extent to which British companies receive equitable treatment in that country. Other things being equal, however, I intend to give weight to the contribution which the applicant has made or is planning to make to our economic prosperity, including the strengthening of the United Kingdom balance of payments and the growth of industry and employment in this country, with particular reference to regional considerations. I shall also take into account any proposals which may be made for facilitating participation by public enterprise in the development and exploitation of the resources of the Continental Shelf."

THE EARL OF DUNDEE

My Lords, this is a fascinating field of endeavour, and we all hope that many of those who will get licences will strike lucky. There is only one question I should like to ask. The noble Lord said that in considering who was going to get licences the Government would have regard to the contribution which the applicant was making, or planning to make, to our economic prosperity, with particular reference to regional considerations. The phrase "with particular reference to regional considerations" sounds to me, not like "McNamarese", but more like a typical piece of Whitehall jargon, and I should like to know what it means. Does it mean that an applicant who is successful in finding oil will be required to construct a long pipe-line to some area where we desire to have a refinery, or does it mean that preference will be given to applicants who are already working in some other capacity in development areas; or does it mean something else?

LORD STONHAM

My Lords, I am much obliged to the noble Earl for his opening remarks, and I join with him in hoping that they will "strike it lucky". If they do, it will be lucky for all of us. In regard to his question about the considerations which the Minister will take into account in granting licences, and in particular regional considerations, if licensees are going to delve down into the Continental Shelf they will, of course, need equipment. One of the considerations would be the amount to which the purchasing and procuring of that equipment would contribute to the economy in general in this country.

THE EARL OF DUNDEE

That would be so. Is the point that, although it might be less economic on grounds of regional planning, we might give preference to a firm which would order its equipment in Scotland or Durham, instead of ordering it in Birmingham?

LORD STONHAM

I do not want to convey the impression that this factor would be overriding or paramount, but it would, as he suggests, be one of the considerations which the Minister would take into account in the manner he has suggested.

VISCOUNT SIMON

My Lords, I do not know whether I misheard the noble Lord, but I thought he said that applicants must be citizens of the United Kingdom and Colonies, or companies registered in the United Kingdom, and then went on to say that if the applicant was a foreigner then this, that or the other would happen. I did not understand that, but perhaps I misheard him.

LORD STONHAM

It is quite easy to misunderstand when a Statement is being read. Indeed, I myself read it twice, in order to make sure that it was correct. So if the noble Lord will allow me, I will read that section again. The words are: As required by the regulations"— that means, of course, the existing regulations— all applicants must be citizens of the United Kingdom and Colonies resident in this country, or bodies corporate incorporated in the United Kingdom, and the profits of the operations will be taxable here. Where the applicant is a foreign-owned concern, I shall look at the extent to which British companies receive equitable treatment in that country. It means that an applicant can be a body corporate incorporated in the United Kingdom, but foreign-owned.

VISCOUNT SIMON

I am obliged to the noble Lord. I see the point.