§ The Earl of LAUDERDALEMy 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 what is the policy of BNOC regarding the sale overseas of crude oil obtained from 51 per cent. participation in offshore oilfield development operations.
§ Lord STRABOLGIMy Lords, in selling the crude oil available to it, whether through participation or from any other source, BNOC proceeds on the basis of its commercial judgment, bearing in mind the national interest.
§ The Earl of LAUDERDALEMy Lords, in thanking the noble Lord for that reply, may I ask him whether the Government continue to press the oil companies, including BNOC, to maximise their sales of refined spirits and to refine as much crude as possible in this country?
§ Lord STRABOLGIMy Lords, BNOC is ensuring the maintenance of delivery of its sales to the United Kingdom refineries. BNOC has been able to increase the sales to the United Kingdom by the renegotiation, where possible, of a limited number of contracts.
§ The Earl of LAUDERDALEMy Lords, can the noble Lord add to the information which he has been kind enough to give to the House by answering this further question: Is it the case that BNOC has been selling its equity crude taken 1688 from participation agreements with BP and selling it to Japan, whereas BP, having lost Iranian oil, is that much shorter of oil for use in this country?
§ Lord STRABOLGIMy Lords, in 1978 about 60 per cent. of BNOC disposals were to United Kingdom refineries. Further details will be released in the Corporation's annual report, which is due out shortly. With regard to Iran, my right honourable friend the Secretary of State announced on 31st January in another place that the Government would watch the situation carefully and keep in close touch with the International Energy Agency and with other Governments. He is also continuing to keep in close touch with the oil companies about the maintenance of supplies to the United Kingdom and the steps they are taking to secure additional supplies from other sources.
§ The Earl of LAUDERDALEMy Lords, can the noble Lord say whether the Secretary of State's endeavours in keeping in touch with the companies includes putting British consumers first and Japanese consumers somewhere lower down the scale?
§ Lord STRABOLGIMy Lords, I am surprised that someone with the noble Earl's considerable technical knowledge should make a remark like that. It would not be in the best interests of the United Kingdom to use all the North Sea oil directly in the United Kingdom refineries without regard to its value in other markets and to the cost of imported oil. The object of our refinery and disposal policy is to maximise the benefit to this country.
Viscount ST. DAVIDSMy Lords, when my noble friend says that BNOC considers the matter of the national interest can he tell me how it assesses that interest? Is it suggested to it by Her Majesty's Government?
§ Lord STRABOLGIMy Lords, the Department of Energy holds regular consultations with BNOC as with all other North Sea oil producers. These consultations include discussion of their disposal plans.