HL Deb 21 January 1974 vol 348 cc1189-92

2.48 p.m.

LORD PARGITER

My 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 whether, in the light of the The Times second leader of Monday, January 14, they would confirm that "North Sea oil belongs to us" (column 712, Hansard, January 10, 1974) and that the E.E.C. will have no say in either its prising or its distribution, and that the international oil companies will be subject to the Government's directives.

THE SECRETARY OF STATE FOR ENERGY (LORD CARRINGTON)

My Lords, I can certainly confirm that North Sea oil belongs to us. The terms and conditions under which companies operate on our Continental Shelf are also our responsibility.

LORD PARGITER

My Lords, would the noble Lord say whether, having regard to the fact that the companies themselves have paid for their concessions and agreed the terms of royalties, and so on, the Government have any further control over them?

LORD CARRINGTON

My Lords, I am examining this whole issue at the present time, and when I have had advice on this and have come to conclusions I will certainly report further to your Lordships.

THE EARL of LAUDERDALE

My Lords, would not my noble friend agree that without the expertise of the oil companies we should never get the oil at all?

LORD CARRINGTON

Certainly, my Lords, the expertise of the oil companies is absolutely essential for the production of oil from the North Sea.

LORD GLADWYN

My Lords, would not the noble Lord agree that, while nobody disputes that the successful development of North Sea oil will be very welcome as regards our balance of payments, unless we can at least begin to agree on some common energy policy (in regard to which I may say I am still awaiting answers to various questions which I put to the noble Lord, Lord Windlesham, the other day) it is rather difficult to imagine, especially after what happened in Paris yesterday, that we shall get agreement on any common policy at all.

LORD CARRINGTON

My Lords, the whole question of energy policy goes even wider than the question of the noble Lord, Lord Gladwyn. President Nixon and Dr. Kissinger have invited us to attend a conference in Washington on February 11 to discuss the whole question of energy—a conference which I hope will ultimately be concerned not just with consumer countries but also with producer countries. It would be of advantage to the whole world—consumers, producers and the underdeveloped countries—if some really sensible arrangements could be made about energy in the future.

THE EARL of LAUDERDALE

My Lords, is my noble friend aware that his statement about North Sea oil has been widely welcomed throughout the length and breadth of Britain?

LORD CARRINGTON

My Lords, I am glad that something I have said recently has been welcomed.

LORD SHACKLETON

My Lords, may I ask the noble Lord whether he is likely to say something a little later to-day?

LORD CARRINGTON

My Lords, I never know whether I see the Press or the Press see me, but let me assure the noble Lord the Leader of the Opposition that I recollect with great clarity a debate we had the other night and I have absolutely no intention of ever again being discourteous to your Lordships, even if I was on that occasion, and I do not think I was.

LORD PARGITER

My Lords, would the noble Lord say whether or not, in the event of the Government's deciding that the whole of the North Sea oil should be used for the benefit of British industry, he would be able to do so without any reference to the Common Market or the oil companies?

LORD CARRINGTON

My Lords, this is a question that I should like to go into in greater depth. We are not going to get any appreciable amount of North Sea oil for another 18 months or so. The circumstances at the time will make us decide what we want to do with that oil. I think what any Government would decide would be to see that the oil which belongs to this country is used to the best national advantage.

LORD SHINWELL

My Lords, when the noble Lord referred to getting oil from the North Sea in "18 months or so", did he mean "18 months" or "so"? What does "so" mean?

LORD CARRINGTON

My Lords, one of the things that I have discovered in the 13 days that I have been Secretary of State for Energy, is that one must not be too specific in these matters. There are a great many imponderables, not least the weather, particularly in the North Sea. I have just been able to see at first hand the problems which people have to contend with in getting oil out of the North Sea and how difficult is the scale of the whole problem. One must try to make sure that every possible effort is put into getting the oil as quickly as possible—not only to keep it up to schedule but to get it even sooner if one can. I should not like to commit myself to any date for any particular amount of oil.

LORD SHINWELL

My Lords, is the noble Lord aware that I entirely agree with what he said? I recognise that prudence and caution are required in this matter. Although I should welcome, as I am sure all Members of your Lordships' House would, an early flow of oil from the North Sea which would help to remove some of our problems, nevertheless there is far too much euphoria about the prospects and we ought to be very careful about that.

LORD CARRINGTON

Yes, indeed, my Lords. I assure the noble Lord that I am not suffering from euphoria.

LORD SLATER

My Lords, this is a most important question. People have been thinking most seriously about this major product that we have been fortunate to find in the North Sea. Can the noble Lord state what arrangements have been made between the parties and Her Majesty's Government regarding the sharing of profits? Is that to be based on a 50–50 basis, or on the system which used to operate when the old coal owners were in operation in the mining industry? The royalty system was used then. Is a royalty system to be a major factor so far as Her Majesty's Government are concerned?

LORD CARRINGTON

My Lords, this is the kind of question that I am examining. I wonder whether the noble Lord would be good enough to put down a specific Question about that, because if I answered off the cuff I might get the answer wrong and then I should be in trouble again.

LORD PARGITER

My Lords, I recognise the difficulty that the noble Lord has in answering questions at this stage, but would he inform the House as soon as possible what the position will be and, if possible, before the oil begins to flow in quantity so that we may be rather better off than we have been regarding North Sea gas?

LORD CARRINGTON

Yes, my Lords. I will let your Lordships know as soon as possible after I have completed the examination and the body I have set up to inquire reports.

LORD LEATHERLAND

My Lords can the noble Lord tell us whether the British Government have received an invitation to the Nixon Conference on February 11? If so, will be be personally attending or will he be engaged in other activities around that date?

LORD CARRINGTON

My Lords, I am surprised that the noble Lord does not know that the British Government have received an invitation and have accepted it. Whether I or somebody else will go will depend upon whether the Prime Minister decides to send me or someone else.

LORD LEATHERLAND

My Lords, is the noble Lord aware that Members of your Lordships' House would have very great confidence in the noble Lord's attendance at that conference?

LORD CARRINGTON

My Lords, I am much obliged. I thought the noble Lord was getting at something else.

LORD CHAMPION

He was!