HL Deb 14 December 1972 vol 337 cc748-50

3.12 p.m.

LORD BALOGH

My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether any further statement can be made on the participation of British firms (excluding the Royal Dutch Petroleum Company) in general and the public sector in particular in the North Sea oil and gas licences; and on the method by which these estimates are arrived at whether they are based on the size of the territory under licence or on the expected production.

LORD DRUMALBYN

My Lords, I confirm that, as I said in the debate on November 22, the present United Kingdom participation in the United Kingdom Continental Shelf petroleum production licences is 32 per cent.—including the British share of Shell—calculated on the area of territory under licence. I also confirm that, as I have told the noble Lord in correspondence, the public sector participation on the same basis is 12 per cent.

LORD BALOGH

My Lords, in the Scottish Grand Committee in another place last week the Minister gave extraordinarily interesting figures of 22 per cent. for gas and 25 per cent for oil as the public sector participation, making an overall ratio of 12 per cent. Would the Minister be kind enough to tell us how those figures were arrived at and how the figures which he has now quoted were arrived at; that is to say, territory or quantity, and if quantity how much?

LORD DRUMALBYN

My Lords, it is really quite simple. The 12 per cent. is based on a calculation of area. The 25 per cent. in the case of oil, and I think 20 per cent. in the case of gas, are based on the extent of participation in the estimated reserves of oil so far established.

LORD BALOGH

My Lords, may we not have a similar figure for established reserves of oil?

LORD DRUMALBYN

My Lords, I think I said 25 per cent. for oil and 20 per cent. for gas.

LORD BALOGH

My Lords, I am sorry. Is the Minister aware that these figures of 20 per cent. and 25 per cent. were then associated with the 12 per cent., which makes complete nonsense of it?

LORD DRUMALBYN

No, my Lords, because the 25 per cent. relates to licences covering those blocks where oil is known to exist and the quantity of reserves has been assessed, whereas the other calculation is based on all licences, whether or not oil has been found there.

LORD SHACKLETON

My Lords, would the noble Lord like to consider producing a statement on this matter, in which we can see how the mistakes—the very serious mistakes, which I am sure he admits, though I do not know whether he has apologised for them—were made on a previous occasion? Would he let us have a full statement of the position, so that my noble friend will be freed from the necessity of continually interrogating the noble Lord to get the facts.

LORD DRUMALBYN

My Lords, a paper will be published before very long which I think will give the noble Lord the kind of information he wants. I did apologise to the noble Lord for the error when I wrote to him.

LORD GLADWYN

My Lords, do the Government believe that there are any lessons to be learned from the way in which the Norwegian Government is handling this very difficult problem?

LORD DRUMALBYN

My Lords, we have not yet studied the Norwegian announcement, which was made only yesterday, but I do not believe that we are very far apart, except on the question of carried interest. But, of course, I cannot make any statement about how the licences will be issued in the future.

LORD HARVEY on PRESTBURY

My Lords, as one involved in these very large enterprises, may I ask my noble friend whether, when he publishes the White Paper or whatever it may be, he will go back to the very beginning, so that one may see the whole history, covering the previous Administration and what they did?

LORD DRUMALBYN

My Lords, I will convey to my right honourable friend the Minister what my noble friend has said.

LORD BALOGH

My Lords, may we have an assurance from the Minister that no further licences will be issued before this issue is cleared up and thoroughly discussed, both with Scotland and also with the larger interests concerned in this country?

LORD DRUMALBYN

My Lords, I am sure there will be ample opportunities to discuss this subject further before the next round of licensing takes place, hut I take note of what the noble Lord has said.