§ 2.43 p.m.
§ LORD HUGHESMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government on what basis they assume a North Sea oil production of 75 million tons in 1980.
§ THE MINISTER WITHOUT PORTFOLIO (LORD DRUMALBYN)The estimate of 75 million tons in 1980 is based upon the assessment by the technical staff of the Department of Trade and Industry of the results of seismic and exploration 605 drilling activity provided to the Department by licensees. Due account is taken of the time needed first to determine the extent of the discoveries that have been made and then to construct the necessary production facilities.
§ LORD HUGHESMy Lords. may I ask the Minister to say whether in these figures he has taken full account of the favourable announcements made by the licensees during, for example, the last six months?
§ LORD DRUMALBYNMy Lords, I believe that to be so, and I know it is so in one case of which I am aware. The information is of course based, as I have said, en the assessment of the technical staff; and in reaching their conclusions they are assisted by the Institute of Geological Sciences, who also get the benefit of the information.
§ LORD HUGHESMy Lords, if that is so, why have the Government in the last year reduced their estimate from 150 million tons in 1980 to 75 million tons in 1980?
§ LORD DRUMALBYNMy Lords, initial estimates are always liable to quite a margin of error. In fact, the figure I am giving now is really composed of two parts, one part of which is reasonably firm while the other is undoubtedly open to a margin of error. It is about half and half.
§ LORD HUGHESMy Lords, is it not the case that during the last six months every change that has been announced has been to increase the firm expectations, yet a year ago the Government put the figure for 1980 as being 150 million tons a year? After all these improvements have been taking place, they are now saying that the figure will be only 75 million tons a year. Why did they say it would be 150 million tons a year ago?
§ LORD DRUMALBYNMy Lords, I think there is some misconception here; 75 million tons is the figure for 1980 and not for the 1980s.
§ LORD HUGHESBut—
§ LORD DRUMALBYNI have not finished answering the noble Lord's last supplementary question. It is expected 606 that the figures will go up during the 1980s from 75 million tons.
§ LORD HUGHESMy Lords, the figure given a year ago was not for the 1980s but for the year 1980. It was then stated as 150 million tons. What has taken place in the interval to cause the Government to halve the figure?
§ LORD DRUMALBYNMy Lords, I am not quite certain what figure the noble Lord is quoting—whether it was an official estimate, an outside estimate or an estimate reported in the Press.
§ LORD HUGHESMy Lords—
§ LORD HUGHESThis is the point at which I will leave the matter, my Lords, and in doing so I will quote what was said last year in the debate on the Scottish economy, by the then Minister of State at the Scottish Office, who said:
The companies concerned are understandably guarded until further development, but it appears that oil will be available from the Northern sectors of the North Sea to the extent of at least 50 million tons a year by the mid-'seventies, and it is not unreasonable to think that it will reach 150 million tons a year by the end of the decade."—[OFFICIAL REPORT, 24/11/71; col. 1032.]He was talking about the "seventies" and "the end of the decade". The end of the decade is either 1979 or 1980 and not any period beyond that.
§ LORD DRUMALBYNMy Lords, I think the noble Lord's quotation shows quite definitely how indefinite the 1980 estimate was at that time, and a year has passed since then.
§ LORD BLYTONMy Lords, is the noble Lord, Lord Drumalbyn, aware that every estimate of fuel consumption in the last 25 years has been entirely wrong? Is it not silly to try to make an estimate for 1980 of something we know nothing about?
§ LORD DRUMALBYNMy Lords, one can make some sort of an estimate on the basis of the seismic tests that are carried out. The kind of estimates that the noble Lord is I think talking about are the estimates of world supply of energy and estimated consumption, and this is precisely why it is so difficult to 607 form a definite energy policy, a point which I have always emphasised.
§ LORD BLYTONMy Lords, I am dealing with Parliamentary estimates and I pointed out that in the last 25 years or more each one has been wrong. Indeed, we are now faced with a measure which is designed to increase the output of coal, this after the coal industry has been clobbered for 20 years.
§ LORD DRUMALBYNMy Lords, if estimates were always right I do not know what would happen on the racecourse.
§ VISCOUNT ADDISONMy Lords, is the Minister aware that in this case the differential in estimating is between 150 million tons and 75 million tons? As what kind of estimating does he regard that?
§ LORD DRUMALBYNAs an estimate with a wide margin of error.