Offshore Petroleum Licensing Bill

Debate between Selaine Saxby and Alan Whitehead

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

[Dr Whitehead]

The hon. Lady is absolutely right. New licences are an international issue. If we had new exploration licences around the world, we would simply produce far more oil and gas than is compatible with the 1.5° climate target. We should just keep it in the ground.

Finally, amendment 21 would go some way towards correcting another element of the carbon intensity test. As currently drafted—the Minister will want to listen to this bit—the test will not take account of methane emissions, which is a serious flaw. The whole case for comparing UK-based natural gas with LNG is based only on production emissions. The emission of methane at various stages of the production and transportation of LNG is, in aggregate, worse than the emissions of UK-produced and piped natural gas, but they are not carbon dioxide emissions, which is what the Bill says should be measured.

LNG’s potential carbon dioxide emissions upon burning are roughly the same as, or perhaps slightly greater than, the carbon dioxide emissions from UK natural gas. As the right hon. Member for Reading West said, that is elevated by the current UK practice of flaring surplus gas, which can be measured in carbon dioxide emissions.

Methane is a much more potent greenhouse gas than carbon dioxide over 20-year and 100-year timeframes. Its lifetime in the atmosphere is shorter than the lifetime of CO₂, but its impact is far more significant. The Climate Change Act 2008 is quite specific on how this should be measured. Section 93, which the Bill mentions but does not act on, states that

“greenhouse gas emissions…and removals of greenhouse gas from the atmosphere shall be measured or calculated in tonnes of carbon dioxide equivalent.”

Proposed new section 4ZB(1) of the Petroleum Act 1998 mentions the carbon intensity of natural gas, but proposed new subsection (3) defines “carbon intensity” as

“the carbon dioxide emissions attributable to its production”.

But carbon dioxide emissions in production are not the principal concern here, as the gas has not been burned at that point. Indeed, I can conceive of smart climate lawyers challenging the test’s validity on precisely that point. The Minister might therefore see amendment 21 as providing a vital lifeline to the integrity of his Bill. To that extent, the amendment might be seen as helpful, but I somehow doubt that he will take it up. To coin a phrase, “It’s the methane, stupid.” The Bill should say so.

Proposed new section 4ZB(4) already gives the Secretary of State the power to amend the carbon intensity test to include emissions other than carbon dioxide. Perhaps the Secretary of State or the Minister will shortly take that up to save the test. We can anticipate a fairly amusing statutory instrument debate when he tries to do that.

Amendment 21 would simply require the Government to produce a report analysing what the impact of that change will be. In the spirit of trying to improve a Bill that, by design, is fairly resistant to improvement, we welcome the amendments tabled by the right hon. Member for Reading West and the hon. Member for North Devon (Selaine Saxby).

The Climate Change Committee and the Environmental Audit Committee have called for a ban on routine flaring and venting, and such a ban is long overdue. A marine spatial prioritisation policy would help to organise and plan an optimal long-term, low-carbon economic strategy for the North sea.

There is clearly significant strength of feeling across the Committee that this is an inadequate Bill, and some of the proposed tests could undoubtedly make a bad Bill a little better, although some of those tests have internal problems. We would not want to vote against those tests, but the only comprehensive climate change and net zero compatible test is the one that we and, in principle, the hon. Member for Brighton, Pavilion (Caroline Lucas) have set out. It is the best available route, within a severely constrained process, to align this deeply flawed Bill with our essential energy security and climate change priorities.

[Selaine Saxby (North Devon) (Con)]

I rise to speak to new clause 2 on spatial prioritisation. The competing pressures on sea space mean there is essentially a spatial squeeze. I fully understand the Bill’s importance, as we all know that the oil and gas industry will have a key role as the UK transitions towards cleaner energy. The Bill will provide reassurance to the industry.

I am grateful that the Government have stated that each annual licensing round will take place only if key emissions tests are met, to support the transition to net zero. I thank the Minister and his team for their ongoing engagement on this issue but, as we seek to turn to renewables and clean energy, we need to ensure that we have the space and infrastructure to carry this forward, otherwise the energy transition will never come to fruition.

I brought up this issue directly with the Minister for Food, Farming and Fisheries, my right hon. Friend the Member for Sherwood (Mark Spencer), at the Environment, Food and Rural Affairs Committee, as my concerns extend beyond just oil and gas. I am also concerned about how floating offshore wind and fishing can cohabit the same ocean space, and I am also concerned about marine protected areas. There is clearly a balance to strike.

It was good to hear the Fisheries Minister’s response about cross-departmental work to ensure that our fishermen have a future in the light of our need to expand our renewable energy sources, but there is an opportunity in this Bill to ensure that we do not repeat these conversations as other energy sources compete for space in the precious waters around our coast. This will help not only the UK’s energy security but our push towards renewable energy, which will support our fishing fleets and retain a simultaneous focus on biodiversity and improving the condition of marine protected areas.

As a coastal MP, all these points are especially important to me. Being an eternal optimist, I think we can do all these things simultaneously if we can plan strategically where we have the opportunity.