Offshore Petroleum Licensing Bill

Dave Doogan Excerpts

2nd reading
Monday 22nd January 2024 Commons Chamber

[Dave Doogan (Angus) (SNP)]

The Scottish National party declines to give this Bill a Second Reading—[Interruption.] Would the Minister for Energy Security and Net Zero, the right hon. Member for Beverley and Holderness (Graham Stuart), like to intervene already? I would be happy to take it. This Bill is as unnecessary—much like the chuntering from a sedentary position—as it is unwelcome. The Prime Minister, no less, claimed that these measures would reduce energy bills, but of course that is untrue, and the Secretary of State was well advised to distance herself from that fantasy. It is claimed that the Bill will assist with the UK’s energy security, but of course it will do no such thing, given the combined effects of an international energy market and the vagaries of the UK’s refining capacity, which is increasingly and substantially incompatible with oil extracted from the North sea basin. The Government seek to gaslight us with claims that there are strict tests to be met in order to issue any new licences, when in fact these Potemkin tests will inevitably be met for each and every licence application in the future, should the Bill pass.

The Bill will not provide an evidence-based assessment of all licences on a case-by-case basis, and as a matter of actual fact, 27 new licences were granted in 2023 alone in the absence of any legislation of this nature and a licensing round has been held by the North Sea Transition Authority every year and a half since 2016. This proposed legislation will, in effect, undermine the NSTA by placing a statutory obligation on it to hold new licensing rounds every year, rather than as and when it deems them necessary in its professional capacity, as is currently the case. Moreover, the NSTA board unanimously agreed that the legislation requiring annual licensing rounds is unnecessary, but the Government are advancing it as a means to guarantee unfettered access to continued hydrocarbon extraction. That is not what we need.

The Bill’s proponents would have us believe that having more licences will deliver lower energy bills, but it will achieve no such thing. We all recognise that oil and gas will continue to be an essential part of our energy mix and, as the right hon. Member for Reading West (Sir Alok Sharma) said, we use oil and gas—certainly oil—for more than combustible uses, so we will need a measured and qualified licensing regime to accommodate an ongoing reliance on oil and gas as a source of energy and much else, but that is not what the Bill proposes.

The thing that is pushing up the price of household and commercial energy is not a lack of licensing but the price of gas on the international market that consumers are forced to pay not just for heating but for electricity, given the bizarre pricing structure and how the UK is set up to favour gas. That energy pricing disaster is compounded by this Government’s failure to invest properly in alternatives such as large-scale, long-duration storage solutions, which would dial a considerable amount of gas out of the system and dial down prices, too.

Fourteen years of Tory mismanagement of our energy security have seen barely sufficient investment going into renewable generation to meet the demands of the climate emergency, and practically no investment going into the network to transmit this new energy. That means consumers are denied access to large swathes of cheap, green, renewable energy because of a lack of grid capacity. Renewable energy, once switched off, to compensate for a 1960s network, is substituted by gas. I appreciate that the Government are improving and investing in capital infrastructure, but it is 14 years too late.

The Bill will not deliver energy security. Indeed, the former chief executive of BP, Lord Browne, said that the Government’s decision to expand North sea drilling is

“not going to make any difference”

to Britain’s energy security, and the former head of the NSTA, Andy Samuel, said in 2022 that the introduction of new licences will make a difference only “around the edges”.

What we need from the Government is a bold plan to further accelerate the electrification from renewables of our domestic energy market. What we are presented with is a backward-looking cash grab for Scotland’s hydrocarbons, which comes at the cost of a just transition. Scotland will lose out by having our energy policy dictated by a remote, luddite Westminster Government who are relentlessly focused on the rear-view mirror, rather than on the future and job security.

[Lloyd Russell-Moyle]

The hon. Gentleman is talking about energy policy being directed by other people. Does he share my concern about our continued membership of the energy charter treaty, which means that any deals signed now will have to be fully remunerated on their potential hope value, not their actual value, even if they are phased out or cancelled by a sovereign Britain or by a sovereign Scotland? I am neutral on the latter issue. Does the hon. Gentleman not think that, like our European partners, we should withdraw from the energy charter treaty to allow ourselves true energy independence?

[Dave Doogan]

I agree entirely with the hon. Gentleman’s ambitions on the energy charter treaty. It is about time that the Government got off the fence on the issue and made a decision.

On job security, let us be clear that this Government care for oil and gas workers in Scotland every bit as much as they cared for the miners and the manufacturing workers in Scotland who were put to the sword in the 1980s, every bit as much as they care for our service personnel living in squalor, every bit as much as they care about the Post Office staff thrown into the privatisation mincer, and every bit as much as they care for junior doctors in England.

[Alexander Stafford]

On my previous intervention, I refer the House to my declaration in the Register of Members’ Financial Interests on my Falkland Islands trip paid for by the Falkland Islands Government.

The hon. Gentleman talks about the miners. In Rother Valley we were hit hard by the closure of the mines, which is why we need a transition. Keeping the new licences going will make the transition slightly longer and keep more people in work. Surely it is a good thing to diminish the negative impact that net zero will sometimes have on certain people.

[Dave Doogan]

The premise of the hon. Gentleman’s intervention is that by delaying things, and maximising oil and gas production, we somehow maintain this link. We could just as easily deliver the same thing by accelerating the delivery of renewable energy and the infrastructure to transmit it to where it is needed. That would have the added benefit of introducing lower bills for consumers and industry, and making sure that we are not reliant on petrostates from far away with questionable regimes. I am looking through the right end of the telescope, whereas the hon. Gentleman and his Government are looking through the wrong end.

In short, the Tories could not give a flying fig for any worker on these islands—as long as their share price remains healthy, to hang with the rest of us. If the question is “How do we protect and transition oil and gas jobs into renewable energy production?”, the answer is definitely not to overstimulate unlimited offshore petroleum licensing. According to industry data, 441,000 jobs were supported by the oil and gas sector in 2013, but that number has already fallen to 215,000—so we are talking about 200,000 fewer jobs in 2022. The Government have issued approximately 400 new drilling licences, in five separate licensing rounds, in that period. The claim that there is a direct and proportionate relationship between the amount of licences issued and the amount of jobs sustained is entirely spurious.

[Douglas Ross]

Can the hon. Gentleman explain to the House and, importantly, his constituents in Angus, many of whom are employed in the industry, what the Scottish National party’s current position is on the issuing of new oil and gas licences? At the moment, does it support them? Or is there is a presumption against them?

--- Later in debate ---

[Dave Doogan]

What is important is the understanding that we will be reliant on oil and gas. This Government are creating a false dichotomy between having unlimited new licences and having an oil and gas sector in Scottish waters and within the UK; the two things are not related in the fashion that they are setting out. The hon. Gentleman should be asking why the UK Government will not match the Scottish Government’s ambition for the just transition and our half a billion-pounds of investment, but I will get on to that in a second.

[Douglas Ross]

rose—

[Dave Doogan]

Is the hon. Gentleman asking whether I am giving way?

[Douglas Ross]

For clarity—

[Dave Doogan]

No, I am not.

Where is the guaranteed ringfencing of revenues from North sea oil and gas production to develop more renewable energy and accelerate the just transition? Accelerating the just transition—not unduly sustaining legacy energy production—will make the difference and deliver real jobs with sustainability, in terms of both the carbon outputs and how those jobs will last into the future. Where is that support?

The Government have claimed that the circa £50 billion in tax revenue over the next five years “could” be used to support the shift to cleaner forms of energy—we are used to jam tomorrow from this Government—but any other form of fiscal revenue could be used to support the future development of renewables. The vacuous observation that the Government have made is so unconnected to reality, unconditioned and unqualified as to be meaningless.

It would have been an uncharacteristically elegant solution for this Government to have ringfenced future oil and gas revenue for the green transition, to marry the endowment of the legacy hydrocarbon industry to the priming of the pump of opportunities of the next renewable industry, but this Government are at least consistent in their ability to disappoint.

To the casualty of the climate from this Bill, which is an inevitable consequence of this course of action, we can add the pace of delivery for the new net zero economy opportunities in Scotland. When oil and gas opportunities go to a plateau of exhaustion in Scotland, as everyone knows they will, what will be left in the cupboard to support communities such as those in Banff and Buchan, Angus, West Aberdeenshire and Kincardine, and elsewhere in the north-east of Scotland? Why are the revenues from the historical exploitation of oil and gas not going into accelerating renewable opportunities and making sure that we deliver jobs for the future?

As I said in response to the intervention by the hon. Member for Moray (Douglas Ross), the Scottish Government have invested £500 million into the green transition for Scotland—[Interruption.] Well, unlike anything to do with this Bill, that funding is allocated and is there to be invested. I will tell you why, Mr Deputy Speaker, this Government are nervous of that figure: because if the UK were to match Scotland’s ambition in the just transition, it would be £5 billion across the UK, but we see no such commitment, vision or climate ambition. What we see is a Tory Prime Minister who cannot effectively lead his party, let alone the UK state or an energy transition, seeking to divide people on the climate, and rolling back on climate action commitments and signals given to industry on electric vehicles and boiler replacements, while over-exploiting Scotland’s legacy hydrocarbons and dragging his feet on carbon capture, usage and storage, especially Acorn.

The picture is revealed even for those with the largest blinkers. The hallmark of failure is stamped on this Tory Government, who will politicise anything, even the climate consensus, in a vain attempt to stem their electoral destruction. The Bill fails to outline a transition away from fossil fuels as per the agreed resolution at COP28, on which the ink is barely dry. The UK delegation signed up to that agreement in the full knowledge of this Bill’s impending passage. We all know that the UK has a questionable approach to its international obligations, but this is plain bad faith.

Finally, the Bill does not acknowledge the climate emergency. In fact, with this Bill the Tory Government are thumbing their noses at the climate challenge that we all face together and should address together. In the Bill, the Government seek to over-capitalise on legacy energy production rather than invest in the renewable energy jobs of the future. Much of that employment and enterprise will be in demand mitigation, with thermal insulation, equipment upgrades and new technologies. As a result of the ambition that drives the Bill and the warped thinking behind it, jobs, the economy, bill payers and the climate will suffer, so I urge Members to decline to give it a Second Reading.

--- Later in debate ---

[Dave Doogan]

I thank the hon. Gentleman for this opportunity to reiterate what I said previously. There is a fundamental understanding of the ongoing role of oil and gas in meeting our energy needs. Whether that is dealt with and satisfied through existing licences or future licences is a moot point, and I will tell him why: I have already demonstrated, in as simple terms as I can, that the implication that there is a direct and proportional link between job security and licences issued is spurious. I am aware of the point he is trying to make, but he is not making it well. I have told him what the situation is, and he can either like it or lump it.

[Douglas Ross]

I would just like an answer. I have tried twice, and that was as clear as mud. I think people looking at that answer will actually be unable to tell what the hon. Gentleman’s personal position is and what the SNP’s position is. That is really important. Maybe it is telling that only one SNP MP has turned up to a debate about the oil and gas sector—

[Dave Doogan]

Have you seen the weather?

[Douglas Ross]

I have seen the weather. I saw the weather when I left Inverness airport at 6.45 this morning. I know what the weather is like in Scotland, but it is important that when we are debating the oil and gas industry, which is crucial to Scotland and the United Kingdom, the SNP can find only one MP to turn up.

--- Later in debate ---

[Douglas Ross]

I absolutely agree with my hon. Friend. We have a base at Buckie harbour that is supporting a number of jobs and will continue to do so for decades to come—it is a small number of jobs at the moment, with opportunities to grow—but at the moment the vast majority of the workforce is employed in the oil and gas sector. I agree with him that they will go elsewhere, shifting their jobs and expertise to other countries, and another city will become Europe’s offshore energy capital. That would be devastating not just for our net zero ambitions and for Aberdeen, but for the economy of Scotland and the UK as a whole.

We have already heard in the debate that 90,000 Scottish workers are employed in North sea oil and gas. It has been for decades, and will continue to be for some time to come, one of the most important sectors in Scotland’s economy. Yet I believe that it is the position of the SNP—it would be if more SNP Members than just the hon. Member for Angus had turned up to state their case—to put those jobs on the scrapheap. The SNP wants to have a cliff edge in our oil and gas sector and exploration because it is in government with the Greens in the Scottish Parliament. It is supporting Green Ministers who want an immediate end to the extraction of fossil fuels from the north-east, and that is putting those 90,000 jobs, and the Scottish and UK economies, at risk. That is viewed extremely dimly in many parts of Scotland, particularly the north-east, which the hon. Member for Angus represents.

[Dave Doogan]

It is a bit rich listening to a Scottish Tory MP talk about the bountiful experience of North sea oil and gas for Scotland. If we had been independent in the ’70s, we would be embarrassingly well off compared with our neighbours elsewhere in these islands. The hon. Member says that we want to throw workers in the oil and gas industry in Scotland under a bus, and that we want to see a “cliff edge” where those jobs disappear. What is his evidence for that? We are investing in a just transition. Whereas he is trying to pursue an endurance of legacy opportunities for employment, we want to turbocharge new opportunities for jobs over 150 to 200 years.

[Douglas Ross]

My evidence is very clear; in fact, it is the hon. Gentleman’s own words. When he cannot even tell this House or his constituents about the SNP’s position on the presumption of new oil and gas licences, that is an answer in itself—not a moot point. The SNP clearly does not support it, and he cannot quite find the words to say it yet. That is the SNP position because it is in office with the Greens in Holyrood, and they are increasingly abandoning the north-east oil and gas sector and the jobs that rely on it. As I say, that is viewed extremely dimly not just in the north-east but right across Scotland.

Offshore Petroleum Licensing Bill

Dave Doogan Excerpts

Committee of the whole House
Tuesday 20th February 2024 Commons Chamber

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

I call the Scottish National party spokesman.

[Dave Doogan (Angus) (SNP)]

I rise to speak to amendments 7, 8 and 10, which have been tabled by the SNP. I note that no substantive changes have been made to the Bill’s provisions since we discussed it some weeks ago in this place; it is no more responsive to the needs of the climate, the energy sector in Scotland or bill payers who are haemorrhaging money on their energy bills. We know, from the appropriation of Scotland’s energy wealth by Thatcher in the 1980s, Cameron’s “Cut the green crap” at the beginning of this Conservative regime, and the weak-minded and politically naive rolling back of the green transition measures by the current Prime Minister, that time and time again, the Tories will never look after ordinary workers, Scotland or the environment.

[Kirsten Oswald (East Renfrewshire) (SNP)]

My hon. Friend is making an excellent start to his speech. Does he agree that it is outrageous that the Prime Minister has masqueraded this legislation as a way of reducing energy bills for consumers, given that even the Secretary of State could not defend those claims? Does he also agree that this Government’s only intention is to unlock as much tax revenue from the North sea oil and gas sector as possible and that no consideration has been given to reducing domestic energy bills, to energy security or to reaching our climate commitments?

[Dave Doogan]

I agree entirely with my hon. Friend. She touches on some of the key elements that I will address in this speech.

In order to salvage some semblance of responsibility and/or equity from this Bill, I urge Members to support the SNP’s amendments. They seek to amend the provisions to facilitate licence issuance on a case-by-case basis, rather than it being done annually and by prescription. That is a reasonable improvement to the Bill by any measure. We would also like to incorporate a real test for new issuance that would require the North Sea Transition Authority to assess whether new licences will: lower energy bills for bill payers; deliver energy security and reduce reliance on imported fuel sources for domestic consumption; enhance sustained job security for the oil and gas workforce in areas of the UK that are economically reliant on the oil and gas sector; guarantee funding for domestic refineries to increase capacity to process sustainable fuel sources; and stimulate the North sea oil and gas sector to meet commitments set out in the North sea transition deal.

The SNP also wishes to ensure that, henceforth, 100% of tax revenues from oil and gas are invested in the just transition. A “just transition” test would have to be met for any given relevant year, under which the NSTA would issue new licences only if it assesses that: they will support the delivery of the North sea transition deal’s greenhouse gas emission reduction targets of 10% by 2025, 25% by 2027 and 50% by 2030 against a 2018 baseline, in order to meet the sector’s aim of a net zero basin by 2050; and the Secretary of State has provided funding to support the development of the renewable energy sector in areas of the UK that are economically dependent on the oil and gas sector, equivalent to tax revenues collected from UK oil and gas production. That amendment means that new licences cannot be issued unless it can be shown that the licence will meet the North sea transition deal’s greenhouse gas emission reduction targets, and unless the UK Government are funding the renewables sector in oil and gas dependent areas to at least the value of oil and gas revenues.

[Douglas Ross (Moray) (Con)]

The hon. Gentleman is speaking about conditions for granting new licences, but the SNP’s draft energy strategy includes a presumption against any new licences—is that his position? Is the SNP’s position that there should be no new licences for oil and gas exploration?

[Dave Doogan]

I am grateful to the hon. Gentleman for that. It is lovely to see him in his place; we know that he is a busy man with his other two jobs. I am sure that Hansard will correct me if my memory does not serve me correctly, but I believe that we rehearsed this issue on Second Reading. Let me point out to the hon. Gentleman, who I am certain is an ardent Unionist, that the position of the devolved Government, and whoever they are, is irrelevant in debating what we do with oil and gas licences in the UK because, sadly, Scotland’s oil and gas endowment, as he well knows—he makes excuses for this regularly—is controlled remotely by a dysfunctional UK Government, whoever they are. So the point is moot.

[Douglas Ross]

Will the hon. Gentleman allow me to intervene, just to provide clarity?

[Dave Doogan]

No, I will not.

The last SNP amendment will prevent this Government and the soon-to-be-installed Labour Government from simply using Scotland’s North sea oil and gas revenues to fund tax cuts in the UK, a state that is demonstrably not paying its way in the world. Both Labour and Tory —two cheeks of the same face, where Scotland is concerned —will sacrifice Scotland’s economic, industrial and material welfare, and those working in the energy sector, if it will win them a few more seats in this place. They have done it before and they will do it again while we remain in this broken and discredited Union. The prosperity that comes from oil and gas in Scotland is finite.

[David Duguid]

I was not sure if the hon. Gentleman had moved on from his glowing appraisal of the North sea transition deal, but can I take it from his reference to that deal that the SNP’s position is to support and welcome it in its entirety?

[Dave Doogan]

I am not going to meet the hon. Gentleman’s ambition to nail those colours to the mast, but I will tell him that through the Bill, the UK Government are turning a blind eye to the implications of a free-for-all when it comes to emissions and who benefits from revenue receipts. I am sorry if he finds that difficult, but he will to have to deal with it.

The prosperity that comes from oil and gas in Scotland is finite, as we know all too well. We have seen what deindustrialisation with no transition plan looks like—we witnessed it at first hand in the 1980s, when coal, steel and heavy industries were all torn asunder on the altar of monetarism and share prices in the City of London. That is set to happen again for oil and gas, under Thatcher’s willing disciples, the Leader of the Labour party and the Prime Minister. We cannot allow that to happen again. It is therefore essential that north-east Scotland and other areas reliant on oil and gas are afforded the investment required. That is what our amendment speaks to; it is about creating new jobs and transitioning in a managed, strategic fashion to accelerate our post-carbon future.

[Douglas Ross]

On that point, will the hon. Gentleman give way?

[Dave Doogan]

No.

That is a just ambition for a just transition. The billions of pounds still to be yielded from oil and gas revenue must not be wasted on doomed capital infrastructure projects, such as HS2, or used to fund exorbitant false economies, such as nuclear power stations in England. It is a moral and economic imperative that revenue be used to accelerate a genuine just transition, to protect jobs.

[Douglas Ross]

In response to my previous intervention, the hon. Gentleman said that the Scottish National party position on this issue was “irrelevant”, but of course it is not; it is vitally important. The SNP’s draft energy strategy says there is a presumption against new exploration for oil and gas. Does he support that?

[Dave Doogan]

That question speaks to a mis-representation. There is no point in giving way to the hon. Gentleman if he is going to misrepresent me in that way. What I actually said was that it does not matter who is in government in a devolved Assembly where energy policy is decided by remote control from a dysfunctional Westminster Government. That is the beginning and the end of it. If the hon. Gentleman does not like it, then he is welcome to join the SNP—well, perhaps not.

We know the facts on the ground: the oil and gas sector is in decline because of finite reserves, and because it is to be considered an industry with a limited future, whereas the green transition has an unlimited future. Jobs have already decreased in the sector. Government Members are giving the impression that with unlimited licensing there will be unlimited jobs, but that is not the case. Jobs have decreased by 228,000 since 2013, despite 400 new drilling licences in five separate auction rounds. Production of gas in the North sea has already fallen by two thirds since 2000 and will fall a further 95% with new licences, as opposed to 97% without.

The issuance of new licences in and of itself will not shift the dial, especially if the revenues from Scottish oil and gas continue to disappear into the black hole that is the Treasury. What is needed is a wholesale redistribution of fiscal receipts from Scottish oil and gas to the renewable transition, ringfenced and guaranteed by statute. In Scotland, we are apt to wonder what we got for the £300 billion in tax receipts from Scotland’s oil—a question now being mirrored for our renewable endowment.

I note that Members on the Government Benches have desisted from repeating the nonsense that energy bills will be lowered if we grant unlimited licences—and not before time. What will lower bills is ensuring that the renewable energy we generate can find its way to consumers without needing to be turned off because the grid cannot cope after 14 years of non-investment by the Tories. New grid infrastructure will lower bills by dialling gas out of the system. Government Members talk about the relentless need for more and more gas, as if that does not speak to a flaky ambition on a just transition; it exposes it and lays it bare. We will dial gas out of the system by having a network that can connect Scotland’s renewable energy to the market where that is required, and we will do so with proper investment in sub-sea lines, rather than by scarring Scotland with 80-metre pylons. It is a pity that the UK Government would not invest the billions that they are ploughing into nuclear into environmentally optimal grid improvements, instead of defaulting to pylons and overhead lines.

The Bill is part of an ill-fated Tory miscalculation on making a just transition a wedge issue. We know that, because the Bill is a non-existent solution to a non-existent problem. Some 27 new licences were granted in 2023, and a licensing round has been held by the North Sea Transition Authority every year and a half since 2016. If the Bill is the answer, then I am not certain what the question is. It undermines the independence of the NSTA by forcing it to hold new oil licensing rounds every year, whereas currently the NSTA undertakes licensing rounds when it deems that they are required. It is a challenge so unwelcome that the NSTA board unanimously agreed that this legislation and the annual licensing rounds were unnecessary. This is what happens when the energy sector, so vital to a broad-based, developed economy like Scotland’s, is subject to remote control.

Renewables already account for the equivalent of 113% of Scotland’s gross electricity consumption, yet we still pay sky-high energy bills because of the amount of gas required for generation in England, due in no small part to the Tories small-minded hysteria surrounding onshore wind, and their 10-year-old ban on development of onshore. Investing further in the green hydrogen sector in Scotland could support up to 300,000 jobs—it is a pity that Members on the Government Benches will not focus on that opportunity—and it would add up to £25 billion to Scotland’s gross value added by 2045. Further development of our renewable sector represents an extraordinary export opportunity for Scotland—one that we must grab much more, instead of looking back; we should look to the enterprises of the future.

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (Ind)]

The hon. Gentleman rightly mentions the sky-high energy prices that people in Scotland face, even though Scotland generates so much energy. What role does he think zonal and modal energy market modelling, rather than a one-size-fits-all, UK-wide approach, would play in substantially reducing energy costs in the likes of Sutherland in Scotland, and also in England, in places like Surrey? Everybody would be a winner if we moved away from the UK-wide model and towards the zonal and modal method.

[Dave Doogan]

The hon. Gentleman raises an interesting question. There has been a lack of investment, and the network that delivers energy around GB was designed for a small number of very large generators. It is ill-equipped to deal with many smaller systems of generation. That is why we find ourselves switching off wind turbines and, where the demand still exits, replacing them with gas, much to all our constituents’ cost and misery. The failure to transition in the electricity distribution network across GB is exactly the same failure we see in our dependency and desire to keep looking backwards. We should transition from hydrocarbons to renewables in a way that respects communities.

In closing, we should grasp Scotland’s bright future with both hands. In so doing, we will rid ourselves of the mismanagement of successive UK Governments in Westminster.

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

Before I bring in some of those who may not have tabled amendments, I remind Members that we are at Committee stage, so discussion is of the amendments. However, as we are also discussing clauses 1 and 2 stand part, there is perhaps a little more scope.

--- Later in debate ---

[David Duguid]

I rise to speak in support of the Bill and of all the employees of companies right across the country, including in my Banff and Buchan constituency, that will play a critical and successful role in the UK’s ongoing energy transition to net zero by 2050.

I remind the Committee that, for 25 years prior to being elected in 2017, I worked in the energy sector—in the oil and gas sector specifically—in a wide range of roles for several different companies and in various places around the world. I also declare that I have a close family member with a financial interest in one of those companies, which is below the threshold required for registering interests. I can also assure the Committee that that financial interest has never had, and will never have, any bearing on my contributions in this or any other debate.

On Second Reading, I spoke about the potential for increased confidence and certainty that the Bill brings to the energy industry. For many people watching, including a few hon. and right hon. Members in this place, there would appear to be a perfectly polarised distinction between maximising oil and gas on one hand and promoting renewables on the other. The truth exists on a continuum between those two extremes, however. We have in fact been on a transition away from the most polluting of fossil fuels towards cleaner, lower-carbon, renewable sources of energy for a number of decades now. That transition is happening at various rates in different parts of the world, but it is fair to say that the United Kingdom is at the forefront, as the first major economy not only to legislate for net zero but to set the most stringent decarbonisation targets.

The Conservative Government have presided over the UK’s becoming the first major economy to have reduced carbon emissions by 50% from 1990 levels. That compares to only 7% that had been achieved by the time the Conservatives came to power in 2010. We have effectively transitioned away completely from coal power, and continue to reduce our demand for oil and gas and increase our renewable and low-carbon capacity, but not as fast as our domestic supplies will continue to decline, even with new production.

A critical point that needs to be reinforced in considering this legislation is that new oil and gas does not mean more oil and gas—a mistake that I heard in the speech of the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle). Even with new production, the North Sea Transition Authority predicts that UK oil and gas production will decline, not by the 3% to 4% suggested by the International Energy Authority to stay within the global 1.5°C target, but by twice that rate of decline, at around 7%. We are today 75% dependent on oil and gas for our energy needs, and not just for electricity generation, but for heat and transportation as well. Of that 75%, about 50% is produced domestically with the rest having to be imported.

The arguments for producing our own oil and gas closer to home have been well rehearsed. There is the obvious benefit of having that source of energy under our control, not that of other states and countries that are not always friendly. We have also heard how liquefying natural gas for transportation and shipping that LNG halfway around the world to then be de-liquefied back into gas when it arrives in the UK can produce up to four times the carbon emissions of domestically produced gas. We know from the Climate Change Committee that we are likely still to be up to 25% dependent on oil and gas by 2050. It therefore follows that carbon capture, utilisation and storage will be required for the UK to reach net zero by 2050. That includes, of course, the Acorn CCS and hydrogen project at St Fergus in my constituency, and in particular the role it will play in decarbonising gas-fired power generation at Peterhead.

What will also be required to get to net zero are precisely those skills, technologies and supply chains that currently exist and will, no doubt, continue to be developed within the oil and gas industry. However, those critical elements would sadly no longer be available to us if we shut down our domestic oil and gas industry prematurely, which is what would happen if the Opposition parties had their way, whether it is the SNP’s “presumption of no new exploration” for oil and gas—a direct quote of the SNP’s draft energy strategy—or Labour’s “just stop oil” approach.

I am seeing some nods of agreement from across the Floor, but there has recently been something of a war of words between the two main parties—I am referring to Labour and the SNP—in Scotland following Labour’s screeching U-turn on its £28 billion a year green investment plan. Of course, we on the Conservative Benches always saw that plan as undeliverable without massive tax increases. Labour announced that it would not only increase the energy profits levy and make it last longer, but remove the investment allowance.

[Dave Doogan]

Will the hon. Gentleman give way?

[David Duguid]

Before I give way, I will gently point out to Opposition Front Benchers—I am not sure whether they are aware of this—that the 78% tax rate they are so keen to copy from Norway comes with an equivalent 78% investment allowance in that country. Labour’s plans would remove the investment allowance, putting future investment across the energy sector even further at risk.

Of course, as we heard earlier, Labour still maintains its position of banning all new oil and gas licences, which has inevitably led to an outcry from the sector in recent weeks. Among others, Offshore Energies UK’s chief executive David Whitehouse has said:

“We remain deeply concerned about what Labour’s proposals could do to our people. If we can’t get companies to invest here, there are no jobs. It’s that simple.”

He went on to describe Labour’s proposals as

“a hammer blow to the energy we need today and to the homegrown transition to cleaner energies that everyone in the UK wants to see.”

That is the key point, which often goes over the heads of so many on the Opposition Benches: the skills and technologies to deliver net zero are not going to appear magically over the horizon, and the talent and expertise in what would become a defunct oil and gas industry will not automatically and immediately transfer across to the renewables sector. More likely, companies and their employees who will find themselves squeezed out of oil and gas in the UK will simply move overseas to deliver someone else’s energy security and someone else’s energy transition—and, no doubt, deliver oil and gas that we would end up having to import.

Of course, the SNP has come out of the woodwork to jump on the bandwagon, criticising Labour’s approach while completely contradicting its previous stance and—more than likely—that of its Scottish Green coalition partners in Holyrood. SNP leader Humza Yousaf said last September that he did not want Scotland to be Europe’s oil and gas capital, presumably wishing to pass that mantle to our North sea neighbours in Norway. A little over a year ago in its draft energy strategy, the SNP stated—I quote again—that there should be a “presumption” against new exploration for oil and gas. I am not sure whether the hon. Member for Angus (Dave Doogan) is still looking to intervene, but I wonder whether he would take this opportunity to answer that question.

[Dave Doogan]

I am grateful to the hon. Gentleman for taking my intervention, even though it was about five minutes ago on a different subject. He made a really interesting point in his speech: that new licences do not mean more oil and gas. Conversely, having a more circumspect and rational approach to licence issuance—taking it out of the political arena and putting it into the bureaucratic space—does not mean less oil and gas. I am sure the hon. Gentleman will accept that if that is true for one, it is true for the other. Does he not agree with my position, and that of my party, that as the oil and gas industry continues on its journey to its natural conclusion of a much reduced industry, for whatever reason—the transition to renewables, or depleted resources—it is much more important, and in fact elegant, to make sure that those tax receipts are invested in the energy of the future, not squandered by His Majesty’s Treasury?

[David Duguid]

I find myself looking for a point that I might agree with in the hon. Gentleman’s intervention, and sadly failing. However, his point about the decline of oil and gas in the UK has been made time and time again. Ever since 2004 we have been a net importer of oil and gas, so my point about new oil and gas not being more oil and gas is about managing that decline to make up for the fact that we are not replacing that oil and gas generation with renewables as fast as we would like. I will address that point in more detail in a moment.

Those comments from the SNP leader just go to show the staggering hypocrisy and inconsistency of the SNP, but neither the industry nor the electorate are so easily fooled, particularly in the north-east of Scotland. If asked whether they support new oil and gas licences, as we have seen today, some SNP Members—and, I dare say, some Labour Members as well—may find it difficult to commit to a position, particularly when facing their constituents in the north-east of Scotland. However, this Conservative Government and, in particular, the Scottish Conservatives have maintained consistent support for the oil and gas industry—the companies, and the tens of thousands employed from right across the UK. We recognise, as this Bill does, the potential for the people in this industry not just to keep our lights on and keep the economy moving in the near term, but to lead the world in showing how a successful energy transition from oil and gas to renewables can be done. Sadly, as has been confirmed a couple of times today, all His Majesty’s Opposition seem able to offer is to lead the world in virtue signalling.

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[Kenny MacAskill (East Lothian) (Alba)]

I rise to support amendment 15 in the name of my hon. Friend the Member for Kirkcaldy and Cowdenbeath (Neale Hanvey), and in particular subsection (b) to proposed new section (1ZA), which relates to Grangemouth. There is something perverse and absurd about using Scottish oil if Scotland’s refinery is to close.

We have to transition. It has to be a just transition, which cannot just be a glib phrase. It must also be paced, because we cannot get there overnight. In my constituency of East Lothian, we can see the turbines on the Lammermuirs, and we can see them growing in number daily, and the growth in the number of columns, as offshore wind capacity comes. But we require fossil fuels to deliver that renewable capacity. We require diesel for the trucks, and marine diesel for the ships, out setting the columns and turbines. We also require the plastics that go with much of that. So we need to continue using and exploiting oil to get to a renewable future. We have to do so at a pace that is appropriate, but also ensure that our country benefits. That is why subsection (b) is so important.

There is something perverse in the fact that Scotland is energy-rich, yet people face fuel poverty. In my constituency, we are not seeing the benefits in employment that should come from being in a county that is so energy-rich. The county faces the same problem as Scotland: it is energy-rich, yet people can only look wistfully at the turbines offshore, while they are unable to pay their bills. We must ensure that we get jobs and work here. The refinery at Grangemouth is pivotal to that.

I grew up not in East Lothian but in West Lothian. The Grangemouth refinery has been there for a century—since 1924—not for North sea oil but for its precursor: the shale industry, which was centred in West Lothian, from which came BP, Paraffin Young and others. BP was the centrepiece, along with Imperial Chemical Industries in its various iterations; it is now Petroineos. The refinery initially dealt with the shale industry, but, once North sea oil was discovered, we used it for that oil.

The Forties pipeline comes ashore from the North sea at Cruden Bay, and oil is piped down to Grangemouth because it was meant to be refined there. Grangemouth is also capable of refining oil from elsewhere: a pipeline runs from Finnart in Argyll through to Grangemouth, which allows oil imported from abroad to be refined in Scotland. Yet we face a situation where unless we support the amendment, Grangemouth refinery will likely close. Although a spat has been going on between the SNP, Labour and the Tories about the North sea and its oil, little has been said about what is happening at Grangemouth. The threat has been growing, and action from the Government both here and in Scotland has been in inverse proportion to that.

[Dave Doogan]

I am sure that the hon. Gentleman will have heard me reference Grangemouth and its future in my contribution. I support his ambition to maintain our hydrocarbon future at Grangemouth, as long as it can be sustained economically and environmentally. Does he agree that if we are to prevent the jeopardy that workers at Grangemouth face from ever re-emerging, we need to make sure that sustainable aviation fuel, biofuels and hydrogen are an integral part of Grangemouth’s output? We need to ensure that they overlap with hydrocarbons and leave them behind.

[Kenny MacAskill]

I have had discussions with the shop stewards and unions, whom the Scottish Government may wish to follow and not brush off with cursory meetings. We want a biofuel strategy for Grangemouth, but that is for some significant time in the future. Unless we act now, the refinery could close in 2025. Biofuels will not be refined in Grangemouth or anywhere else in 2025. The shop stewards and the unions wish us to get to biofuels, and Grangemouth must be declared a hub for that, but if it is to survive until then, we must ensure that it is a refinery, not simply a terminal, and that we maintain those skills.

It is absurd that we will continue to exploit Scotland’s oil, yet its refinery will close. There is something perverse about that. Scotland will be the only major oil-producing nation in the world—we are ranked No. 21 along with the UK in the top 25 oil producers—that does not have a refinery capacity. That will put us with large developing countries that produce less oil. We will join a club hosted by the likes of the Republic of Congo and Trinidad and Tobago. I am sure that they are lovely countries—I have never visited—but they are not developed nations with an industrial economy. The danger is that we will become a developing nation, in terms of our industrial base.

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[Graham Stuart]

I thank the hon. Gentleman for his question. He has taken a long and deep interest in this issue, for which I pay him respect. It is the burning of oil and gas that is the primary issue. He mentions 110%—we probably have 200%, 300% or 400%. There are countries setting out to massively increase their production. That is all driven by demand. If we—as a species, as a globe—are to get to net zero, we will have to cap wells all over the world. We will have to leave it in the ground. The most important thing is to ensure that the demand curve is going in the right direction. Despite all the issues, challenges and difficulties of maintaining our role as the leading major economy in cutting emissions, the UK’s biggest challenge in dealing with climate change is not domestic, despite the difficulty of that; it is to get others to join us on a net zero pathway. The idea of producing our own emissions to ever-lower standards and replacing them with higher-emission products from abroad is for the birds. It makes no sense.

[Dave Doogan]

Will the Minister give way?

[Graham Stuart]

I am going to press on. [Interruption.] I do not mean to be rude, but I think I am unlikely, given his previous performance, to be terribly afeared of hearing from the hon. Member for Angus.

I turn to a series of amendments that seek to place conditions on when oil and gas licensing rounds are run. Amendment 15 relates to carbon capture, usage and storage, and the Grangemouth refinery. The oil and gas sector provides a significant portion of the investment that the UK needs to go into wind, CCUS and hydrogen, and I fear that the amendment would drive that investment elsewhere. It would also tie UK production of oil and natural gas to the refining activities of one refinery—Grangemouth—which I am sure Members across the House would agree is neither practical nor desirable.

Amendments 22 and 24 would result in an inconsistent approach between oil and gas licensing and our ambition for domestic energy efficiency. The Government already have a clear aim for as many homes as possible to reach energy performance certificate band C by 2035 where cost-effective, affordable and practical. That is the minimum standard required to replace fossil fuel boilers with low-carbon heating such as heat pumps.

On amendments 23 and 25, we are already reviewing our energy charter treaty membership. As far as we are concerned, there is no longer a clear route for modernisation. We will update the House in due course.

New clause 2 was tabled by my hon. Friend the Member for North Devon (Selaine Saxby), who was right to highlight the importance of achieving strategic co-existence between different uses while maintaining environmental protection. Work is under way to ensure that we strike the right balance between our different marine priorities. The soon-to-be-commissioned strategic spatial energy plan and cross-Government marine spatial prioritisation programme will ensure, as she rightly outlines, that we take a strategic approach to identifying future sites for marine developments and energy infrastructure, and that these can co-exist with our environmental and wider marine priorities. I appreciate what my hon. Friend seeks to achieve and assure her that the Government share her desire to protect the marine environment—not least, of course, in the Celtic sea.

Amendments 2, 3, 13 and 18 seek to add an additional climate test to the Bill. The UK produces far less oil and gas than we need, and even with new licences, production is expected to decline faster than the average that is required globally to align with the UN’s 1.5°C pathways. All that this test would do is stop licensing and increase dependence on imported products like LNG, which has production emissions that are four times higher than those of domestically produced gas. The right hon. Member for Doncaster North knows this—he must—so what, other than ideology and a desire to please his Just Stop Oil backers, could lead him to table an amendment that could raise emissions, lose British jobs and hammer our economy? Truly, it is a mystery.

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[Douglas Ross (Moray) (Con)]

It has been interesting following the process of this Bill. I spoke on Second Reading, and I sat through most of the Committee today, and I am pleased to speak on Third Reading to support the proposals brought forward by this UK Conservative Government—the only party supporting our vital oil and gas industry across the United Kingdom, and particularly in the north of Scotland. My constituents in Moray, many of whom work in the oil and gas industry, will be shocked and annoyed by what we have heard today from those on the SNP Benches and by the deeply disappointing remarks we have just heard from the hon. Member for Southampton, Test (Dr Whitehead) on the Labour Front Bench. If he thinks that “misinformed scaremongering” from Offshore Energies UK and from Aberdeen chamber of commerce does not deserve to be raised in this Chamber, he is gravely wrong. I think it is an indication of Labour’s position. It has already turned its back on the oil and gas industry in Scotland, and by the sound of things it will only get worse. [Interruption.] He is looking quizzical, but let us just look at what is happening in Scotland now and at some of the coverage.

I do not know whether the hon. Gentleman is a regular reader of The Press and Journal, but its front page made clear what people in the north-east of Scotland think about Labour’s proposals. The Scottish Sun said that people in Scotland could wave goodbye to tens of thousands of jobs. That is not the papers or the Opposition just saying that; it is papers reporting what experts in the field are saying. We know that the Labour party changes its policies quickly, and I can only hope this is another of those, because its actions are having a deeply damaging effect. Were these policies ever implemented, they would have a huge impact on the oil and gas sector and the people who work in it and rely on that oil and gas production. Tens of thousands of jobs and livelihoods are at risk.

As we often want to articulate our own views in this Chamber, I think it is only right that we repeat some of the concerns raised by the industry. Offshore Energies UK’s chief executive Dave Whitehouse is someone who must be listened to on this subject. I met him recently on a visit to Aberdeen. He said that Labour’s proposals

“would deliver a hammer blow to the energy we need today and to the homegrown transition”.

He also said:

“These are not faceless numbers but decent, hardworking people working across the UK to provide the energy we will need today and in the future.”

That is an expert view on the Labour proposals.

Aberdeen chamber of commerce has described Labour’s plans as a “betrayal”. Chris Wheaton, an oil and gas analyst, said:

“The uncertainty created by threatening new windfall taxes is as bad as the tax itself.”

Perhaps most powerfully of all, last week, more than 800 individuals, firms and trade groups wrote to the Leader of the Opposition to express their deep concerns about what is being spoken about by the Labour party.

Sadly, in Scotland, we cannot get a cigarette paper between the Labour party and the SNP. It is almost as if they are in a race to decimate our oil and gas industry and want to outmanoeuvre each other. Both support a windfall tax. Both oppose the Rosebank field. Both are speaking about dangerous proposals—[Interruption.] Liberal Democrat Members think that is funny. I am sorry, but I do not think it is funny that tens of thousands of jobs across Scotland are under threat. I take that issue extremely seriously.

Speaking about the SNP, I tried to get this out on Second Reading and in Committee. I am delighted that the hon. Member for Angus (Dave Doogan) is still in his place, because we have to get to the bottom of this. I ask him to intervene on me and explain whether he, as the MP for Angus, representing a north-east constituency, believes further licences should or should not be granted for production of oil and gas in the North sea.

[Dave Doogan]

I do not know about you, Mr Deputy Speaker, but I have just about heard enough from the hon. Member today. For the fourth time, Government Members’ association between the number of licences issued and the number of oil and gas jobs protected is specious at best. We have been accused by them—including, I think, the hon. Member—of wanting to put the oil and gas industry in Scotland to the sword. There is no such plan. The leader of the SNP and Scotland’s First Minister Humza Yousaf was in Aberdeen just yesterday talking about how Scottish oil and gas workers must never be left behind.

I am disappointed in the hon. Member for Banff and Buchan (David Duguid)—I thought more of him—misquoting Humza Yousaf, who said that he would rather Aberdeen was not the oil and gas capital of Europe but the renewable energy capital of the world. That promises vastly more economic opportunity for workers in Scotland. Government Members had better start dealing with that.

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I remind Members that this is a Third Reading and that we should not be reopening arguments that were heard in Committee or previous stages.

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[Douglas Ross]

That is just one example of the mixed and confused messaging from the SNP which, sadly, we hear far too much in this Chamber. We have heard it across the north-east this week and it has dominated much of our proceedings.

[Dave Doogan]

Will the hon. Member give way?

[Douglas Ross]

I will, because this may be our final chance to hear if the hon. Gentleman believes in the SNP’s draft energy strategy, which included a presumption against licences for new oil and gas exploration.

[Dave Doogan]

As much as I am enjoying the hon. Member’s crocodile tears about protecting jobs in Scotland, I wonder if he could give confidence to those oil and gas workers in Scotland by highlighting an example from recent history when the Tories have protected anyone’s job anywhere?

[Douglas Ross]

It is only this UK Conservative Government and the Scottish Conservatives at Holyrood who are standing up for an industry that supports more than 200,000 people across the United Kingdom and 95,000 people in Scotland. We have heard that 42,000 jobs are at risk under the Labour proposals, which are almost identical to those of the SNP.

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[Dave Doogan]

The Bill is completely lacking in merit. It seeks to solve a problem that does not exist. The North Sea Transition Authority can issue licences, and it has been doing so. This is a Potemkin argument; a specious debate about the issuance or otherwise of licences. When this Bill passes, which it will given the arithmetic in this House, it will change not one jot the ability to issue licences or otherwise. What it seeks to do is put on a pedestal and create conflict in what was previously broad consensus about the need for a just transition to combat a climate emergency.

In the tone and tenor of the debate today, Government Members in particular have shown a desire to weaponise that. We just heard from the hon. Member for Moray (Douglas Ross), who said in his summing up that only the Conservatives are standing up—absolute and utter nonsense, although if I was working in oil and gas, I would not want to rely too heavily on Labour, if its £28 billion plan is anything to go by. It could have included measures to offset the rapacious appetite for more and more licences to drill for every drop of oil and gas within the North sea basin and receipt every available ha’penny of tax into His Majesty’s Treasury. It could have done those things, and chucked a little bit over the wall to say, “But we’re going to put 5%, 10% or 15% of all those revenues directly into the just transition.” That would not have been brilliant, but it would have been something. But no—there is not a thing in this legislation to offset the appetite for further and further investment.

Government Members have spoken at length about the need to ensure that we do not develop a gap between that which we demand and that which we can supply—it has already passed; the UK can no longer sustain its own demand. We have to import oil and gas from elsewhere. But that is a myopic obsession with the supply side. There is not nearly enough being done by the Government after 14 years to mitigate the demand side. Supply is a function of demand; the be supply requirements are such as a result of that which is being demanded. If there had been a truly ambitious programme at any stage over the past 14 years to insulate houses, get people into electric vehicles and introduce further decarbonisation of our economies and lifestyles, we would not have the demand that we have now. The potential gap between that which can supplied domestically and that which has to be imported would inevitably be less in a zero-sum game. However, we do not have any of that.

[Douglas Ross]

I will not go over an issue that I am not going to get an answer to. However, the hon. Gentleman’s own party has been in government in Scotland for 17 years now, and the Scottish Government have repeatedly missed their own climate change targets, largely because they have not done what he is accusing the UK Government of not doing. How does he reflect on his own party and Government in Scotland who have not done enough to insulate homes, get more people into electric vehicles and put in the charging points that we need across the country?

[Dave Doogan]

Not for the first time, the hon. Gentleman has stood on a political landmine if he thinks he is going to hold me to account on the availability of charge points. What he may not know—although, knowing him, I suspect he probably does—is that someone wanting to find anywhere on these islands with more vehicle charge points than Scotland would need to come to London or the south-east of England. Scotland has many more available charge points for electric vehicles—

[Douglas Ross]

Rubbish!

[Dave Doogan]

Well, we can sort this out later. Scotland has the third highest availability of electric vehicle chargers of all geographical areas in the United Kingdom. I think the Scottish Government’s record is exemplary—having, as we do, one hand tied behind our back due to being a member of this non-Union, with the freedom of movement and zero agency that comes from being a non-sovereign state. Any other normal country could invest into whatever it wants, and could do so using the normal levers that an independent country would have. Scotland, of course, cannot do that because it must wait for its cheque every year from Westminster. If the hon. Member for Moray (Douglas Ross) does not like that, he knows what to do.

I pay tribute to the hon. Member for Banff and Buchan (David Duguid) for the work he did in finally grinding out some progress from his partners and colleagues in government on the Acorn project, but that just typifies the slowness—the absolute pedestrian nature—of measures to protect consumers and the environment from the largest possible demand. If we had gone into that with a proper fund and with ambition and pace five, six or seven years ago, we would not be in this situation now.

The SNP’s amendment proposed an elegant solution to invest the additional receipts from oil and gas extraction in the North sea basin directly into the renewable transition, protecting people from higher bills, insulating their homes and getting them out of their petrol and diesel cars and into electric cars. As we saw in the Prime Minister’s rolling back on heat pumps and electric vehicles—a further weaponisation of the climate emergency—that is not on the agenda of this fag end Tory Government. They are trying to scrabble around looking for votes, but that does not work. They have achieved tremendous damage with that approach and judging by recent by-election results they have gained zero political capital. On the mess that is evident before us—[Interruption.]—while I get heckled by the hon. Member for Moray, I and my SNP colleagues urge Members to decline the Bill a Third Reading.

[Several hon. Members rose—]