Oil and Gas Industry

– in the Scottish Parliament am ar 6 Mawrth 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Annabelle Ewing Annabelle Ewing Scottish National Party

The next item of business is a debate on motion S6M-12388, in the name of Douglas Lumsden, on backing Scotland’s oil and gas sector.

Photo of Douglas Lumsden Douglas Lumsden Ceidwadwyr

The oil and gas sector continues to be one of the most important issues in Scottish politics today—and rightly so. Tens of thousands of jobs depend on it, thousands of communities rely on it, and hundreds of businesses are based in Scotland because of it. The Scottish Conservatives remain the only party that believes in the contribution that the sector makes to our economy and that has committed to supporting it for a long time to come.

Photo of Kevin Stewart Kevin Stewart Scottish National Party


Mr Lumsden care to comment on the extension of the windfall tax on the oil and gas industry, which will damage the north-east of Scotland? How will he respond to his Tory masters in London in order to get shot of it?

Photo of Douglas Lumsden Douglas Lumsden Ceidwadwyr

I will gladly respond to Kevin Stewart. Yes, I am disappointed that the windfall tax has been extended, but let us have a think about what the other parties would do. The Scottish National Party is in favour of a windfall tax but, more than that, it has a presumption against oil and gas exploration, which would devastate the oil and gas industry. Labour, with Red Ed, would have no new licences, would have a windfall tax on steroids, would ramp up the rate and would scrap the reinvestment allowance. At least the Greens are consistent—they would shut down the industry tomorrow.

I go back to the point that I was making. What I said does not mean that our green credentials are any less or that we are turning our backs on our ambition to reach net zero—far from it. We believe that the oil and gas sector has a huge role to play in our energy transition. We are committed to working with our workers, communities and businesses to ensure that, as we move forward towards our net zero targets and as we transition away from oil and gas and towards greener technologies, we do so in a way that protects jobs and livelihoods across Scotland, particularly in the north-east.

We are the only party that is committed to continuing to support oil and gas exploration while we still have demand in this country. Seventy-eight per cent of Scotland’s current energy needs are met by oil and gas. That figure rises to 92 per cent when we are talking about the percentage of heat demand that is provided by hydrocarbons. While we still have demand for oil and gas, it is better for the environment, for our economy and for our jobs that we use our own resource, as opposed to relying on imports from elsewhere. Cutting off that supply, under the SNP’s presumption against new oil and gas exploration, would leave us all worse off and throw thousands of livelihoods on the scrap heap.

Photo of Daniel Johnson Daniel Johnson Llafur

As Douglas Lumsden is so keen on economic growth, what does it say about his Government’s performance that we have had seven quarters of decline in gross domestic product per head of population? Why was it that, in the latest auction round, no one competed for offshore wind contracts? What does that say about your economic record and your credibility on renewables?

The Deputy Presiding Officer:

Members need to speak through the chair.

Photo of Douglas Lumsden Douglas Lumsden Ceidwadwyr

I am just about to talk about gross value added to highlight the importance of the oil and gas industry, which the Labour Party would turn its back on by turning off the taps. The oil and gas industry accounted for over £20 billion of Scotland’s GVA in 2022-23. That was nearly 11 per cent of Scotland’s total GVA.

The economic impact of losing the oil and gas sector should not be underestimated. The Scottish Government’s own figures show that there would be a loss of £7 billion by 2050. Those jobs would not be replaced by green jobs, and they would be less well paid and would have a lower GVA than jobs in the oil and gas sector. Again, that is according to the Government’s own figures. It is time for this devolved Government to be honest with people and tell us how that money will be replaced in the Scottish economy and how the gap will be filled.

On the SNP’s presumption against oil and gas exploration, Reform Scotland stated:

“It would be a ridiculous position for Scotland to find itself in if it ends up having to import fossil fuels for a period while simultaneously boasting about a decline in domestic production, all the while losing skilled workers.”

I agree that it would be “ridiculous”—it would be absolutely bonkers.

The loss of skilled workers is a huge concern. The energy sector workers survey found that there are too many barriers to oil and gas workers moving into green jobs. It also found that more information was needed and that the support and help for those in the industry who are looking for a new opportunity simply are not there yet.

The First Minister recently visited the north-east. Although he may have had soundbites on how important the oil and gas industry is, we all know that words are cheap; it is actions that count. The First Minister is not pulling the wool over the eyes of anyone in the north-east. He was there not to try to save offshore workers’ jobs but to try to save one job and one job only—that of Stephen Flynn.

The First Minister sits on the fence so often that his backside must be full of splinters. He masquerades as a friend of the oil and gas industry, but we all know that it is the grubby deal with the Greens that he values most. While the Bute house agreement exists, the oil and gas industry will always be demonised by this devolved Government, and that is driving away investment.

We know what the priorities of the SNP-Green devolved Government are, and they are not our priorities. While it is talking about independence, we are talking about jobs, prosperity, economic growth, investing in our industries, supporting our oil and gas industry, and investing in new technologies. The SNP is against Aberdeen being Europe’s oil and gas capital. It is against Rosebank and the £8 billion of investment that it brings. It is against Cambo and against new licences in the north-east.

As our motion points out, the Labour Party is no better on the topic. Labour has also confirmed that it would block any requests for new licences. It has said that it would cut the oil and gas investment allowance. Offshore Energies UK said that that move would lead to 42,000 job losses and £26 billion of economic value being wiped out.

There is only one party in here that supports new oil and gas licences, and that is the Scottish Conservatives. There is only one party in here that understands the economic importance of the oil and gas industry, and that is the Scottish Conservatives. There is only one party in here that will stand up for thousands of workers in the oil and gas industry, and that is the Scottish Conservatives.

I move,

That the Parliament recognises the vital role that oil and gas plays in Scotland’s energy mix and in supporting tens of thousands of Scottish jobs, particularly in the north east, and in providing vital energy security; condemns the Scottish Government’s “presumption against new exploration for oil and gas” as stated in its draft Energy Strategy and Just Transition Plan, as well as the Scottish National Party administration’s failure to welcome new oil and gas developments such as Rosebank, which will boost UK energy security and the economy with a direct investment of over £8 billion as well as providing nearly 1,600 jobs; further condemns the Labour Party’s intention to block any new oil and gas licences and its proposed extended windfall tax, which the OEUK has warned will lead to “42,000 job losses” and £26 billion of economic value being wiped out; acknowledges that there is a climate emergency and, therefore, welcomes that the UK has become the first major economy to halve emissions from their peak; notes that a just transition is needed to meet net zero targets, but believes that this must not leave any industry or community behind and cannot be achieved without the investment, innovation and skills from the oil and gas sector, and calls on the Scottish Government and the Labour Party to end their reckless assault on North Sea oil and gas workers and Scotland’s economy.

The Deputy Presiding Officer:

Thank you, Mr Lumsden.

I call the Cabinet Secretary for Wellbeing Economy, Net Zero and Energy, Màiri McAllan, to speak to and move amendment

The Deputy Presiding Officer:

Cabinet secretary, I had not quite finished. I need to read out the number of the amendment.

I call the cabinet secretary to speak to and move amendment

S6M-12388.3. You have up to six minutes, cabinet secretary.

Photo of Màiri McAllan Màiri McAllan Scottish National Party

Thank you, Presiding Officer.

I am delighted to contribute to this important debate on the future of Scotland’s oil and gas sector, which is a sector that is central to the Government’s plans for a transition to a new and greener economy.

Let us start by dispensing with some of the myths that we have heard from Douglas Lumsden and focusing on simple facts.

First, oil and gas will remain part of Scotland’s energy mix for some time to come. There is no transition to net zero that sees the immediate end of oil and gas, and we are clear that there is no route to net zero except in partnership with business—especially in respect of skills and investment.

Secondly, there is a global climate emergency, and there is unequivocal scientific evidence that there is an urgent need to reduce reliance on fossil fuels.

Thirdly and finally, our North Sea oil and gas basin is geologically mature and will inevitably decline over the coming decades.

Those are not questions of politics but of science. In that context, the right approach—the approach of a responsible Government and the approach that the SNP has consistently taken—pursues the prosperity of our people, our economy and this planet. That means a just transition that is fair and in line with our climate commitments.

Photo of Douglas Lumsden Douglas Lumsden Ceidwadwyr

The cabinet secretary talks about prosperity. Does she support the award of a licence to the Rosebank oil field, the investment of over £8 billion that that will bring to Scotland, and the protection of thousands of jobs, many of which are in the north-east of Scotland?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I have already been quite clear that I do not think that the decision that was taken on Rosebank was the right one. The Scottish Government has many concerns about, among other things, the proportion of Rosebank’s oil and gas that will be exported overseas, which will not contribute to our energy security.

It is also abundantly clear that the Tories’ approach to oil and gas licensing demonstrates that the UK Government is not serious about the climate crisis. As Douglas Lumsden speaks flippantly about a climate emergency, I wonder whether he truly appreciates what that means. Has he considered the plight of millions around the world who are already feeling its first and worst impacts and losing everything, up to and including their lives? Has he noticed that 2023 was the hottest year ever recorded? Closer to home, has he considered the destruction of our infrastructure and the disruption to our communities from our recent storm season?

Photo of Liam Kerr Liam Kerr Ceidwadwyr

Can the cabinet secretary remind the Parliament how much more of our emissions, proportionately, come from imported oil and gas than from oil and gas sourced locally?

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I do not deny the importance of oil and gas to Scotland’s energy mix; in fact, I opened my speech with an acknowledgement of their current importance. However, circa 80 per cent of what is extracted from the UK continental shelf is exported overseas, and it is therefore not necessarily contributing to energy security in the United Kingdom.

The Tories are utterly reckless on climate change, and that recklessness reminds us of what I think is an intolerable fact: that Scotland’s North Sea oil and gas, its licensing and the associated regulatory and fiscal regimes remain reserved to a remote UK Government. Through our draft energy strategy and just transition plan, which we consulted on last year—

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I am afraid that I do not have a great deal of time.

Through our plan, we have set out a responsible and balanced set of proposals for an approach to future licensing. We are currently finalising that strategy, and I hope that the UK Government will pay attention.

As part of that work, we have consulted on a presumption against licensing for entirely new oil and gas exploration activity. To be clear—and to return to my point about the importance of evidence-led policy development—we have never proposed no further North Sea licensing at all. That would be wrong: it could destroy the very skills and investment that we urgently need in order to transition to a low-carbon economy. Instead, our draft strategy consults on fields that are already identified but not yet in production being subject to a robust climate compatibility checkpoint.

The proposals in our strategy represent a focus on meeting Scotland’s energy security needs, reducing emissions and ensuring a just transition for our oil and gas workforce. To be clear on the first of those, the North Sea will continue to provide Scotland with an important level of energy security over the coming years.

A key aspect of that—which is paramount in Scottish ministers’ considerations—is the issue of skills. We need to harness our skills, talent and experience to support the build-out of low-carbon technologies in Scotland. The infrastructure of the North Sea and the associated skills and expertise are and will be a huge asset in helping us to achieve net zero and to become a world leader in renewables in areas such as offshore wind, hydrogen and carbon capture, use and storage, or CCUS.

The Deputy Presiding Officer:

T he cabinet secretary should be starting to conclude her remarks.

Photo of Màiri McAllan Màiri McAllan Scottish National Party

I am afraid that I cannot give way.

It is worth noting before I conclude that the UK budget that was announced earlier today has extended the windfall tax regime for North Sea oil and gas. That demonstrates, among many other things that are pertinent to this debate, just how little influence the leader of the Scottish Tories has when it comes to his leadership in London. I understand that he made personal representations. He must be utterly embarrassed that he has been ignored.

In conclusion, the future of the North Sea and the future of the tens of thousands of jobs that rely on it are too important to be the subject of the misrepresentation and myth making in the Conservative motion. Instead, our approach will be governed by the science, Scotland’s interests and a cast-iron guarantee to the workforce. That is what the Scottish Government proposes, and it is what we are working to deliver. I urge members to support our amendment.

I move amendment S6M-12388.3, to leave out from first “vital” to end and insert:

“important role that is played by oil and gas in the energy profile of Scotland, the tens of thousands of jobs in that sector, and the essential contribution that the sector’s skilled workforce must make to Scotland’s present and future energy security; understands the severity and urgency of the global climate emergency and the clear body of scientific evidence showing the need for a rapid shift away from current reliance on fossil fuels as part of the response to this; further understands that a just transition for Scotland’s oil and gas sector is essential, given both the declining nature of the North Sea basin and Scotland’s climate change commitments; supports a just transition approach for all sectors of Scotland’s economy, in which emissions are reduced in line with climate goals, energy security is maintained, and workers and communities are supported as part of a genuine managed transition; acknowledges that the Scottish Government is in the process of finalising its Energy Strategy and Just Transition Plan, following the publication of analysis of consultation responses on the draft Strategy and Plan; recognises that licensing and regulation for offshore oil and gas, and the associated fiscal regime, are all matters that currently remain reserved to the UK Government; expresses frustration that the Scottish Government does not have all of the powers necessary to ensure that Scotland fully capitalises on its competitive advantages in the energy transition, including its world-leading and highly skilled offshore workforces; calls on the UK Government to deliver simple, holistic and predictable windfall taxes on excessive profits to address the cost of living crisis and to increase investment in the transition to net zero, and believes that revenues should not be used to fund new nuclear power.”

Photo of Daniel Johnson Daniel Johnson Llafur

When the Conservatives lodged the motion, last week, it was clear what they wanted. They wanted a big bust-up, a big debate and big dividing lines. Let me try to strike a note of consensus, however. I think that we can all agree on one thing this afternoon: Douglas Lumsden desperately needs Jeremy Hunt’s phone number. One text message is all that it would have taken: “Should I lodge this motion? Is it a good idea?” That would have spared the blushes and the rather awkward argument that we heard in the debate’s opening speech this afternoon. Of course, Douglas Ross does not need Jeremy Hunt’s mobile phone number, as he communicates with the leadership via letters from the whip’s office, if reports about him intending to vote against his own Government’s budget are true.

Although Douglas Lumsden tries to talk about economic growth, the simple truth is that, through the mini-budget, which the Scottish Conservatives enthusiastically backed, we got market chaos, the pound tumbling, interest rates soaring, the biggest ever one-day drop in 30-year gilts and half of mortgage products pulled. It culminated in the Bank of England intervening to prevent the collapse of pension markets. Chaos and incompetence are the true hallmarks of economic governance under the Conservative Government.

There have been 14 years of erratic economic decision making. Is it any wonder that the UK is blighted by low growth and high inequality? The Resolution Foundation describes the UK as a stagnation nation. The country has undergone 15 years of economic decline. Since the Conservatives entered Government, the UK’s GDP growth has been in the bottom third of Organisation for Economic Co-operation and Development countries. If the UK had grown at just the OECD average, our economy would be £140 billion bigger. That has real-world consequences. It is the equivalent of £5,000 per household every year. That is the real cost of economic chaos under the Conservative Government.

Photo of Brian Whittle Brian Whittle Ceidwadwyr

That was a good rant, but I wonder what the member says to the fact that the Office for Budget Responsibility has said that, since 2010, Britain has had the highest GDP growth of all the G7 countries, including Japan, Germany and France.

Photo of Daniel Johnson Daniel Johnson Llafur

The OECD figures speak for themselves. We have had seven quarters of economic decline in GDP per head. If Mr Whittle wants to choose partial statistics, that is his decision. The reality is that we have flat growth, investment is down and tax is up. If Mr Whittle wants to call that a rant, that is fair enough, because working people are paying the price for that incompetence.

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

Is Daniel Johnson going to talk about all the stuff that he is talking about or the stuff in the motion? Is he going to talk about Labour’s policy on oil and gas, or is he embarrassed about it? He should be.

Photo of Daniel Johnson Daniel Johnson Llafur

They are the same thing. The Conservatives want to base the debate on economic growth, and that is exactly what I am doing.

Let us come back to the motion. I am equally confused by the SNP. At least the Conservatives had the good grace to chop and change their position over the course of a week. In the space of a day, we have had Stephen Flynn arguing against a windfall tax only to have an amendment in front of us arguing for it. Which is it? The SNP has the unconscionable and unfathomable position that it opposes attacks against energy giants that are making billions of pounds of profit while it asks Scots who earn just £28,000 or more to pay more tax than the rest of the UK. We have the simple choice of helping Scots who are struggling with bills or helping energy giants.

Photo of Gillian Martin Gillian Martin Scottish National Party

Daniel Johnson’s party colleagues have said that a windfall tax would support new nuclear in the rest of the UK. Does he agree that it should be diverted to support renewables growth in Scotland? Will he commit to that?

Photo of Daniel Johnson Daniel Johnson Llafur

I will explain. We will set up Great British energy, which will create 50,000 clean power jobs in Scotland, create investment in Grangemouth and in ports and be headquartered in Scotland. That investment will be ring fenced and the windfall tax time limited.

The simple reality is that we have had five Prime Ministers, seven Chancellors of the Exchequer, 11 economic growth plans and three different positions on a windfall tax from the Conservatives. It is time for change.

I move amendment S6M-12388.1, to leave out from “recognises” to end and insert:

“believes that if Scotland is to maintain its reputation for expertise in energy generation, there is a need to deliver a just transition to the clean energy industries of the future; recognises the huge contribution that oil and gas make to Scotland’s energy mix and economy, supporting tens of thousands of well-paid jobs, and agrees that, as part of the energy transition, oil and gas production will continue in the North Sea for decades to come; condemns the economic incompetence of the UK Conservative administration and the Scottish National Party administration, which has exacerbated the cost of living crisis for households in Scotland; believes that the policies and instability of the UK Conservative administration are further undermining progress in delivering the energy jobs of the future and failing to improve energy security; notes that the Scottish National Party administration has chosen to side with energy giants over working people with its recent u-turn on a windfall tax on exorbitant profits of oil and gas companies, all while raising taxes on working people, and notes that the Labour Party’s proposed windfall tax is time-limited, will sunset at the end of the next parliamentary session and will provide the revenue to deliver the Labour Party’s Green Prosperity Plan, which will support 50,000 clean energy jobs in Scotland, create GB Energy as a publicly-owned energy company, bring down energy bills and deliver the just transition that Scotland’s climate needs, and that workers in the north east deserve, so that no community is left behind.”

Photo of Liam McArthur Liam McArthur Democratiaid Rhyddfrydol

It is safe to say that the debate has not panned out quite as Douglas Lumsden and Douglas Ross intended. I assume that Jeremy Hunt and Rishi Sunak are now safely on the circulation list for the Scottish Conservatives’ media grid and, indeed, Holyrood’s

Business Bulletin


Notwithstanding the exquisite schadenfreude of watching the proposers of today’s motion hoist by their own petard over windfall taxes, I start, as is customary, by thanking Douglas Lumsden for allowing this brief debate. Of course, it is just the latest of many such debates this session to focus on the oil and gas sector, our future energy needs and how Scotland and the wider UK can make the just transition to a decarbonised energy system.

The motion rightly acknowledges the vital role that oil and gas play in Scotland’s energy mix, as well as the jobs and economic benefit that it supports. It will continue to play that role going forward, but our reliance on oil and gas needs to come down for environmental and economic reasons. The OBR, which has been mentioned in the debate, concluded last year that the UK is

“one of the most gas-dependent economies in Europe”, with 78 per cent of our energy needs being met through fossil fuels. That dependence has left us more exposed to fuel price shocks such as the one that followed Putin’s illegal invasion of Ukraine, causing hardship and damage to households and businesses across the country. The UK Parliament’s Environmental Audit Committee recently concluded:

“Accelerating the transition away from fossil fuels will enhance the UK’s energy security and ... also help to protect households from volatile fossil fuel prices permanently”.

Talking about the costs of action ignores the even greater financial costs of inaction or inadequate action. Whatever the sound and fury of this short debate, the transition is inevitable. The North Sea basin is winding down. That is a matter of geology, not policy or politics. For all the grandstanding, as Chris Stark told a meeting of party leaders in Bute house recently—

Photo of Liam McArthur Liam McArthur Democratiaid Rhyddfrydol

Not at the moment.

Chris Stark said that the Tories and the Greens are arguing about whether North Sea production will decline by 95 or 97 per cent by 2050. How that transition happens matters to all of us, of course, but it matters particularly to those who are directly affected and who will make the transition. The transition will require both of Scotland’s Governments to co-operate and collaborate—a consistent message from the UK Climate Change Committee.

We cannot afford bad-faith actors, either in Downing Street or in Bute house, with ministers hunting out division or grievance for political gain rather than acting in the interests of the country, our economy and the wider environment. We know that there is an appetite for transition in the oil and gas sector, but, as Douglas Lumsden fairly said, help is needed—, from advice to skills development and support to reorient business.

Substantial investment in infrastructure from grid to port is also needed to support the delivery of renewables projects and storage technologies.

Photo of Liam McArthur Liam McArthur Democratiaid Rhyddfrydol

I will not. I apologise to Mr Whittle.

Resourcing is also needed in our planning and consenting regimes if the transition to cleaner energy is to take place within the challenging timeframes that we have set.

If it is to be a just transition, people and communities cannot be left behind, even if some activities and even businesses might inevitably be. That will require people and communities to be fully involved in, and at the heart of, the decisions that are being taken. None of that will be easy—all the easy stuff has already been done—but it will be made harder, costlier and more painful if we pretend that it does not need to happen or can be delayed.

Today’s debate was not really supposed to be about how we make a just transition. It was not even about the interests of those in the oil and gas sector. It was an attempt to use climate change as a wedge issue. Although I do not have an awful lot to thank Jeremy Hunt for, I thank him for shooting Douglas Lumsden’s fox.

Photo of Tess White Tess White Ceidwadwyr

There is no denying that the past decade has been exceptionally challenging for the energy sector because of the downturn in oil and gas, the Covid-19 pandemic, Putin’s war in Ukraine and the global energy crisis—not forgetting the massive supply chain disruption that was caused by the conflict. Many companies throughout the supply chain in Scotland have battled to stay afloat, and livelihoods have been lost.

Just as there was an upswing in the industry, more uncertainty struck. The North Sea became a bargaining chip in the disastrous Bute house agreement, with Patrick Harvie and Lorna Slater castigating the industry and the thousands of people in my region who rely on it for work. Patrick Harvie ludicrously proclaimed that only those on the hard right support oil and gas extraction.

The SNP’s draft energy strategy includes a presumption against new exploration for oil and gas. It does not want Cambo, Jackdaw or, as we have seen and as is being reinforced today, Rosebank. It does not care about the UK’s energy security, workers in the north-east or the environmental impact of importing fossil fuels.

The Scottish Conservatives recognise the importance of a fair, careful and well-managed move to renewables. We know that we need an energy supply that is more secure and more sustainable. The north-east, with its unrivalled technical knowledge and know-how, is perfectly placed to become a world leader on net zero. However, propped up by the Scottish Greens, the SNP wants to turn off the taps and go for the fastest possible just transition. It is a cliff edge, plain and simple.

The moment that Nicola Sturgeon signed on the dotted line with the Scottish Greens, she betrayed the north-east, because the SNP-Green Government values virtue signalling over 90,000 highly skilled jobs.

Photo of Gillian Martin Gillian Martin Scottish National Party

Does Tess White agree that we have an opportunity to have a second energy wave in the north-east? If we accept that the North Sea is a declining basin—everyone accepts that—and we prepare for the future by investing in renewables, that will protect jobs in the energy sector in the north-east.

Photo of Tess White Tess White Ceidwadwyr

I agree with Gillian Martin on the importance of investment, and it is true that it is a declining basin. I worked in the energy sector for decades, and we both understand that. However, it needs to be a managed and programmed proper transition, not a rushed and forced transition, which is what the SNP Government wants us to have.

A rushed, premature transition serves no one, nor does it serve Scotland’s economy. Offshore Energies UK has warned that the region will be £6 billion a year poorer by 2030 as a result of such a transition. I think that that matters to Gillian Martin’s constituents as well.

Humza Yousaf, who announced last year that Scotland would stop being the oil and gas capital of Europe, has suddenly decided that he is the saviour of North Sea workers. There must be a general election on the horizon. What an insult to the intelligence of the thousands of people who rely on the North Sea for their livelihoods.

The SNP can pivot all that it wants, but the north-east has not forgotten the depth of the betrayal that was perpetrated by Nicola Sturgeon. I see Labour members laughing, but Daniel Johnson did not mention oil and gas even once in his speech—

The Presiding Officer:

Ms White is closing.

Photo of Tess White Tess White Ceidwadwyr

I thought that I was in a different debate.

The Scottish Conservatives will stand up for our oil and gas industry. We support new oil and gas licences. We will not abandon the industry or the workers who rely on its continued survival, and we will not allow the industry to shut down.

Photo of Ivan McKee Ivan McKee Scottish National Party

Scotland has been blessed with not one but two energy jackpots over our history. The oil and gas jackpot has transformed the north-east of Scotland over past decades, has made Aberdeen a global energy hub, has built Scottish businesses and has created jobs and wealth across our country. However, more than £300 billion of the revenues that have flowed into public coffers as a consequence have gone south, where they were used to subsidise the Thatcherite economic experiment and where they continue to bolster UK public finances to this day.

As we all know, oil and gas was always going to be a finite resource, and our modern understanding of climate change drivers makes it even more so. SNP members are clear in our understanding that, had we had the power to do what Norway has done since the 1970s, an independent Scotland would now be one of the richest countries in the world. We should remember that, in the 1960s, Norway was poorer than Scotland. Having made that mistake once, we now have the opportunity to do it right the second time around. Like someone who bought the winning lottery ticket, lost it and then bought the winning lottery ticket again the next week, we need to take advantage of the opportunity that we have been presented with.

The renewable energy revolution finds Scotland at its heart. As well as vast natural resources, Scotland has expertise in deepwater technology, a global reputation in energy and a highly skilled workforce, and the Government has invested in that technology to make sure that it is developed in order that we can maximise the opportunities for renewable energy development that exist in our country.

Photo of Liam Kerr Liam Kerr Ceidwadwyr

On that point about investment, how much of the £80 million that the Scottish Government promised to provide for the Acorn project has been invested in so far?

Photo of Ivan McKee Ivan McKee Scottish National Party

The Scottish Government is committed to a £500 million investment, as the member should know. I am sure that the cabinet secretary will give the member the latest data on exactly where we are with that, unlike the UK Government, which has not put its money where its mouth is when it comes to supporting the just transition.

The Presiding Officer:

Mr McKee,

I must stop you for a moment. I am aware of colleagues having conversations back and forth across the chamber, and both colleagues know that that is inappropriate, so I would be grateful if they could resist any temptation.

Photo of Ivan McKee Ivan McKee Scottish National Party

The transition needs to move as fast as it can while recognising that investment, which is running into many tens of billions and beyond, is needed from the energy sector. The sector knows that its future viability relies on making the transition as quickly as possible to secure first-mover advantages. The future of energy in Scotland is renewables—everyone recognises that. However, there needs to be a just transition that balances the needs of workers, communities and local businesses.

During my time as a minister, I watched Scottish supply chain companies around the world making the transition. They went from 90 per cent supporting the oil and gas sector to 50 per cent or more supporting the renewables sector. Businesses—both the oil majors and the supply chain businesses—understand the need for the transition, and the Scottish Government continues to support it.

What it is most important to recognise is that the way to end fuel poverty in an energy-rich Scotland, to ensure that investment takes place in infrastructure and to ensure that the transition is just is not by making the same mistakes that we made in the 1970s but by ensuring that Scotland has the powers to deliver the benefit of its vast and enduring renewables potential. We should have the powers of a normal, independent country.

Photo of Martin Whitfield Martin Whitfield Llafur

It is always a pleasure to follow Ivan McKee, although I do not agree with all of his content. I point out to Mr McKee that before the oil there was the provision of coal in Scotland, and there were the tragedies that betook those communities that were affected by the Thatcherite closure of the coal mines.

History tells us time and again that the providers of energy sources are often given bad deals, which is why, rightly, in the chamber and elsewhere, there are discussions about why the transition—and it is an inevitable transition—to green, net zero energy manufacturing matters. It is right and understandable that the communities that support the offshore oil and gas industry are concerned, but I do not think that the language and the tone that are being used help us, as we talk about absolute failure or absolute success, but people in those communities know of the need for transition. They look to their children and do not want them working off in the North Sea or in physically demanding and dangerous jobs. They want the skills and the technology to be put into the better, greener technologies that are available.

It is an obligation—not only on the Scottish Government but on the Scottish Parliament and on those in the UK—to ensure that there is a transition from one form of fuel to another. That transition is not going to take place instantaneously; it is going to take decades. It is going to have to be constantly revisited, renewed, looked at and supported to ensure that—for once in the history of Scotland, the UK and, possibly, the world—we can make a transition for our communities that will allow them to remain communities and allow their young people to be skilled and to work in an industry where they grew up, perhaps to see the next great bonus in Scotland from our renewables.

There has been an intervention on nuclear power. I am never one to let the opportunity to state the importance of that net zero energy to go by. There is also the very thorny question of how we ensure that the grid—both the current grid and, more important, the next generation of the grid—can be base-loaded and sustained so that we can draw on the new and not-so-new renewables technologies to keep the lights on in homes.

I welcome Tess White saying that she is looking forward to the general election; let us hope that it happens sooner rather than later. When we knock on the doors of constituents to speak to them, we find that it is still the case that they fear their fuel bills and wages that do not make it to the end of the week, let alone the end of the month. Young people are distressed by the fact that their parents are making challenging decisions.

That is why we need a new and improved idea about how we do it. The whole concept of GB energy—a state-owned, publicly owned energy company—is to allow for the imaginative and explosive ideas that we need to transition properly, to support our communities and, above all, to pay back to those communities that in the past have paid so dearly for such changes. We need a supply chain that is based here in Scotland and not around the world. Most importantly, we need reforms to the national grid so that we can support an energy policy and energy manufacturing that will allow the whole of the United Kingdom to benefit from the skills that we have developed.

Photo of Bob Doris Bob Doris Scottish National Party

As tempting as it is to dwell on the Scottish Conservatives’ embarrassment at the topic of windfall taxes, I am going to resist for the time being and concentrate on the Labour Party.

It takes some doing for me to still get surprised at the sheer hypocrisy of the UK Labour Party here at Holyrood. However, let me congratulate it—it has succeeded in surprising me. To use a debate on North Sea oil and gas to suggest that the SNP has exacerbated the UK’s cost of living crisis is quite something, again letting the Tories off the hook. This is a UK Labour Party whose position on Scottish independence has seen Scotland left to the ravages of successive UK Governments over many years. It is a UK Labour Party that has been happy to see huge profits from North Sea oil and gas flow to a UK Treasury over decades, often to fund tax cuts for the very wealthy, particularly in London and the south-east.

Photo of Bob Doris Bob Doris Scottish National Party

No, thank you, sir.

Since the 1970s, £300 billion has flowed to the UK Treasury from North Sea oil. What audacity Labour has. Labour links any further tax on North Sea oil and gas profits specifically to funding investment in nuclear energy in England. [


.] That is a bare-faced cheek. Labour is the party that was U-turning on all kinds of social policy protections, citing costs, yet it has been happy to sign up to ending the cap on bankers’ bonuses. Labour has no underlying principles and it has no credibility.

Photo of Bob Doris Bob Doris Scottish National Party

No, thank you, sir.

More generally, I support windfall taxes as required—although, to be fair, it should not take a windfall tax to ensure that large, highly profitable companies are taxed appropriately. I would much rather that the levers over any taxation regime and tax incentives sat here in Holyrood. Additional revenue accruing from any excess profits from Scottish oil and gas could be used to support households through the cost of living crisis. It could be used to support our oil and gas sector, its workers and communities in Scotland, particularly in the north-east, through a just transition from fossil fuels, but not to prop up the nuclear industry in England. There also needs to be a wider debate more generally about ensuring that the taxation regime for highly profitable businesses is fit for purpose and that it offers them certainty, and that all sectors are considered, not just one.

I turn to the Conservative motion, which is one of blind opportunism—blind as far as the UK budget is concerned, as the Scottish Conservatives had no Scooby what was coming up in that statement, and blind to the need to secure net zero and to see a meaningful just transition away from fossil fuels.

However, the Tories are at least consistent. They consistently seek to vote down any substantial measures that are suggested to tackle the climate emergency. One thing is clear with the Conservatives: they will continue to use North Sea oil and gas as a cash cow, irrespective of the climate impact. When that cash cow has stopped giving, they will see the community of the north-east decimated, in the same way that Scotland’s coal-mining communities were decimated a few generations earlier.

As a Glasgow MSP, I say to communities in the north-east of Scotland: we have your back. We will not let that happen. Rather, we need a balanced, planned and managed approach to moving away from oil and gas, one that works with the sector in planning for a just transition and one that allows the highly impressive expertise of oil and gas companies and their highly skilled workforce to pivot towards the opportunities of that just transition. I firmly believe that that is what our Scottish Government is trying to achieve. It will not always be easy. Sometimes, it will mean taking actions that, although necessary, may not be popular. Whatever we do, it will prioritise a socially just approach to supporting our communities that are currently relying on the oil and gas sector.

The Presiding Officer:

Mr Doris, you must conclude.

Photo of Bob Doris Bob Doris Scottish National Party

We will not shirk away from the challenges that are presented by the climate emergency.

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

I am proud to stand and support the motion in the name of Douglas Lumsden. I remind Bob Doris that, when it comes to embarrassment, he is representing the party that campaigned for two decades on the slogan “It’s Scotland’s oil”. Now, it is embarrassed by the idea that we should have a thriving oil and gas sector. I say to Martin Whitfield that Labour closed more coal mines than Mrs Thatcher ever did, but Mrs Thatcher built more ferries than the SNP has ever done. Let us be clear: if it were left to the perpetrators of the Bute house agreement, there would be no future for North Sea oil and gas.

Only recently, Humza Yousaf stated his ambition that Scotland should no longer be the oil and gas capital of Europe. What a signal to send to investors.

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

I will, if the member is brief. I have no time.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

Humza Yousaf said at our Aberdeen conference that he wanted to make Aberdeen the global renewables capital, recognising that we require a just transition and that Aberdeen’s skills are still up there. Does Mr Kerr recognise that Aberdeen should lead the way and that it should be the global renewables capital?

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

I believe that our countries should be world leading in every respect: oil and gas and renewables. It is not a choice; we can have both. That may seem to the member to be cakeism, but I am all in favour of having your cake and eating it. We can have that in Scotland, because of our country’s strategic strengths. For as long as the SNP goes on setting its programme for government by the strictures of the Bute house agreement, it cannot expect the oil and gas sector to take it seriously.

The SNP is against new licensing, new activity and new investment.

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

Someone is shouting no, but that is what we heard from the cabinet secretary. The SNP has reservations about everything to do with the development of oil and gas. Let us be frank: the SNP even voted against the Offshore Petroleum Licensing Bill at its second reading. Mind you, only 27 SNP members voted against it, because I presume that the rest were already taking Keith Brown’s advice not to bother turning up for work.

Truthfully, the SNP needs to ditch the Scottish Greens and end the Bute house agreement. There are wise heads in the SNP ranks who know that only too well—some of them may even be in the chamber right now.

Scottish Labour could not care less about the voters of the north-east of Scotland—it has given up on the north-east. Look at its policy on the oil and gas levy. Daniel Johnson did not want to talk about that, and I can understand why. Not only does Labour want the levy to be extended for the whole parliamentary session, unlike the Conservatives—of course, we are disappointed that it has been extended for a year; Labour also wants to remove the investment relief. Labour is also against new oil and gas licensing. If I have got that wrong—although it is in today’s policy, it is the Labour Party, and we never know where it stands on anything—I am happy for Michael Marra to tell me. Is that the policy or not?

Photo of Michael Marra Michael Marra Llafur

There is impressive hyperbole from Mr Kerr on that point. I do not think that he has much ground to stand on about the change in policy. Is his point not fatally undermined by the fact that, for all the screaming and shouting from members on his benches, the Conservative chancellor believes that having a windfall tax is the right thing to do? Why can he not agree with his own party on that?

The Presiding Officer:

In conclusion, Stephen Kerr.

Photo of Stephen Kerr Stephen Kerr Ceidwadwyr

Oh, that is a shame. [


.] I am disappointed to be having to close and I am disappointed in that aspect of the budget, but take the budget as a whole: it is a great budget for the country, for workers and for growth and, I hope, it will be a great budget on which to re-elect a Conservative Government.

Photo of Mr Mark Ruskell Mr Mark Ruskell Green

We are now more than two years on from the 26th UN climate change conference of the parties—COP26:

a summit in which the world did not dare mention oil and gas, despite all the warning signs. It was the year when the International Energy Agency and the United Nations called for no new oil and gas fields to be developed in order to keep the 1.5°C target alive. Since then, we have seen why holding down every fraction of a degree of global warming is absolutely critical. The planet has burned and flooded, and we have stood by, helplessly counting the cost.

Finally, last year in Dubai, at a COP summit hosted by a petrostate, there was a breakthrough of sorts—the world added oil and gas into an agreement for the first time. The world is beginning a new consensus on oil and gas, and it is time for the UK Government to abandon its reckless “Drill, baby, drill” approach. The choice that is before the UK Government is to either enable every last drop of oil and gas to be extracted, leading the industry to a deferred cliff-edge collapse, or start managing the decline now and put in place a transition that leaves no workers behind.

It is an inconvenient truth that North Sea oil and gas is in decline, and everyone in the chamber knows it. That is why it is so important for the Scottish Government to move away from supporting maximum economic recovery and start the conversation about a presumption against new oil and gas development.

We need to be aware of bogus arguments and where they originate. In its production gap report, the United Nations warned us that private fossil fuel firms are

“highly politically organised, investing considerable resources into lobbying, campaign finance, public relations and think tank sponsorship”, and that they exert influence through what the UN has described as

“a revolving door between business and Government.”

Photo of Mr Mark Ruskell Mr Mark Ruskell Green

I do not have time to take interventions.

I ask the whole chamber to call out bogus arguments for more oil to deliver energy security for the UK, when we know that 80 per cent of North Sea oil is exported to global markets. I ask members to recognise that exploration licences that are granted today may not even produce oil until 2050, which is five years beyond our net zero target date. I ask members, including Liam Kerr, to wise up about false comparisons between the climate impact of North Sea gas and that of imported liquefied natural gas, when we know that the lowest-carbon gas comes from our nearest neighbours in Norway.

Members need to consider critically the assertion that a 3 per cent increase in the windfall tax would suddenly lead to the collapse of an entire industry overnight, because it is a fact that the energy profits levy came with a supertanker-sized loophole—a tax relief of up to 91 per cent for investment in more oil and gas, which was investment that was most likely going to happen anyway. Closing that loophole could have brought in billions to solve a cost of living crisis that was destroying ordinary people’s lives.

The UK Government could have chosen to make those tax reliefs available for renewable investments in order to create the jobs of the future today, but it chose not to do that. Tax allowances and reduced tax rates have allowed the Treasury to give more money to oil companies than it takes from them. In 2020, Shell was paid £80 million in negative tax, while the chief executive officer pocketed £5.5 million and the shareholders received record dividends, and at the same time, Shell made redundant 330 of its workers in the North Sea. That is absolutely shameful—did the Tories in the north-east condemn that when it happened?

The real traitors will be the ones who understood perfectly well what needed to be done but wilfully stood by, did nothing and condemned future generations to climate chaos and an unjust transition. It is time for responsibility and action, and I look forward to the Scottish Government leading the way.

Photo of Ben Macpherson Ben Macpherson Scottish National Party

I recognise the importance of these issues to colleagues who represent the north-east, but I also recognise that they are significant to us all, nationally and internationally. It is important to acknowledge that the climate crisis is the most serious global problem that we have ever faced—it must be at the forefront of humanity’s agenda.

We must be honest and humble and recognise that Scotland and the UK cannot solve this problem alone, but we have the know-how, and substantial renewable resources that are not available to other countries, to make a significant contribution to addressing the global challenge. We have an obligation to humanity, including ourselves, to play an active part.

Nationally, as others have said, one of the most serious issues that we also face is energy security. That is an on-going consideration, but we must keep it in mind that energy involves global markets and that we have a declining basin in the North Sea.

The energy industry as a whole, including oil and gas, is one of the most significant sectors in our country. We should celebrate that, and I appreciate the points that have been made today in that space. The jobs are highly skilled and well paid, and we must keep that in consideration as we transition to net zero. I say for clarity that I have full admiration for those who work in the oil and gas industry—for their technical knowledge and for what they do week in and week out, particularly those who are on rigs in the North Sea. It is important that we put that on record.

From my brief time working in the renewables sector, I know how many people from the oil and gas sector are passionate about moving into the net zero space. In fact, most of our renewables companies are populated by those from the North Sea oil and gas industry, and they are making a huge contribution.

Photo of Kevin Stewart Kevin Stewart Scottish National Party

To allow folk to make the shift from oil and gas into renewables, investment has to be made. That is why the Scottish Government has invested £500 million in the just transition fund. Does Mr Macpherson think that the UK Government should match that fund in order for us to get that just transition?

Photo of Ben Macpherson Ben Macpherson Scottish National Party

It is important that there is public investment, as has just been stated. It is also important that we have consistency in policy making and direction. Investors are seeking to put money into net zero. Net zero is the future for social and economic benefit as well as for the global context of tackling climate change. The UK Government’s chopping and changing has confused the considerations for investors, whereas the Scottish Government’s commitment to renewables and net zero is realised and recognised, and that is important. The Scottish Government is finalising its energy strategy and just transition plan. That will be a crucial document, and I look forward to engaging around it at committee and here in the chamber.

In conclusion, I will touch on something that my colleague Ivan McKee rightly raised, which is the fact—to use his phrase again—that Scotland has hit the energy jackpot a number of times. As much as I enjoy being in the north-east when I am there, it is objectively fair to say that, given the oil and gas sector’s success, the infrastructure investment that the north-east has had is not what it should have been. If we compare the north-east with Dubai, for example, the evidence is there to see.

We need to make the most of the opportunity in net zero. I am sure that we can come to a position, particularly with the Scottish Conservatives today, that, whatever the final destination of Scotland’s constitutional future is, this Parliament should have powers over energy regulation and taxation.

The Presiding Officer:

We move to winding-up speeches, and I call Michael Marra to speak for up to four minutes.

Photo of Michael Marra Michael Marra Llafur

Scottish Labour has absolutely recognised that our energy industry is utterly vital to the workers, their families and the wider economy—not just in the north-east but across the whole of Scotland. A genuine just transition that protects the livelihoods of workers in the North Sea must be provided. That is absolutely essential. We are absolutely clear that oil and gas will be part of our energy mix for decades to come. Government must work with the energy industry to manage the transition to clean energy in the coming years.

However, doing that job is not easy. It is a moral as well as an economic challenge, as various members have set out this afternoon. It will require careful analysis and reliance on the science, as the minister has highlighted, and a genuine partnership with industry. As Liam McArthur set out well, it will also require collaboration and co-operation between Governments across these islands, and that is in far too short supply.

However, we must have a full-scale rejection of the hyperbole that is on display from Conservative colleagues today, heroic and voluble though the attempts from Stephen Kerr, in particular, were on that point. Their leader, Douglas Ross, has been hung out to dry by the Chancellor of the Exchequer today.

Photo of Douglas Lumsden Douglas Lumsden Ceidwadwyr

I understand that Michael Marra might not want to listen to the members on these benches, but will he at least listen to companies such as OEUK, which has said that, under Labour’s plans to remove the reinvestment allowance,

“42,000 jobs and £26 billion of economic value” will be lost? Even former Labour councillors such as Barney Crockett in Aberdeen have disowned the Labour Party over that.

Photo of Michael Marra Michael Marra Llafur

I say to Mr Lumsden that we work as closely as we can with the oil and gas industry to talk about its concerns on that. Clearly, the process of getting from the current situation in oil and gas production to a clean energy system is challenging—that is what I am trying to set out. It is not an easy pathway, and it is one that we have to work on in collaboration and partnership to make happen. As part of that, we absolutely stand up—just as Mr Lumsden’s chancellor did today—for a continued and improved windfall tax in the North Sea, to ensure that we can pay for the transition that has to happen.

Photo of Michael Marra Michael Marra Llafur

Not on that point. I will make some progress, sir.

With the SNP, what we have instead is tax cuts for energy giants and tax rises for ordinary working people—our nurses, teachers and police officers—during a cost of living crisis in which people are struggling to make ends meet.

Bob Doris asked what the windfall tax is designed to do. I can tell Mr Doris that it is designed to deliver 50,000 jobs and cheaper bills in Scotland; GB energy to be headquartered in Scotland; investment in Grangemouth, the Forth and the Tay; incentives to develop new energy products; and a revolutionised national grid.

Photo of Michael Marra Michael Marra Llafur

No, thank you.

In short, it is a plan to deliver that transition. Daniel Johnson was absolutely right to set out—

Photo of Michael Marra Michael Marra Llafur

No, sir, I will not. I am coming to my conclusion.

Daniel Johnson was absolutely right to tell the chamber that this was about economic reality—the one that the Tories do not want to face up to. The OBR told us today that GDP per person across the UK will be lower in 2028 than it is today. Every single person is poorer because of this Tory Government.

It is as a result of that that Labour’s plan is now in front of us. The oil and gas sector is integral to the question, and the transition is vital to the future of our Scottish economy.

We must reject the hyperbole of the Tories, who have been holed below the waterline by their own party on those issues, and we must support the amendment in Daniel Johnson’s name.

The Presiding Officer:

I call Gillian Martin to speak for up to five minutes.

Photo of Gillian Martin Gillian Martin Scottish National Party

I thank members for their contributions. I welcome the opportunity, as I always do, to stand up for energy workers—particularly those in the north-east, whom I represent—and future energy workers, too. If we harness the opportunities ahead of us, the prosperity that the north-east has been so fortunate to have had over many decades will be spread across Scotland, which is worth working towards.

The oil and gas sector has played, and will continue to play, a huge part in Scotland’s energy future. That workforce and that supply chain are the envy of our European partners—as energy minister, I see that everywhere I go when I speak to partners outwith the UK—who realise that we are best placed to capitalise on our renewables future. That skills base and that supply chain will get us there, and we support them whole-heartedly.

We are committed to such a just transition, and we are working in partnership with industry to develop it.

Photo of Gillian Martin Gillian Martin Scottish National Party

I will, in a second—I promise.

Even if there was not a climate emergency, we know that we need to plan for a future in which it will become more expensive and more difficult to extract oil and gas from the North Sea. Companies will make a business decision to go elsewhere in the world to extract oil and gas. We cannot put our heads in the sand on that; we would be foolish not to prepare for that inevitability. What is left in the North Sea will get harder and more expensive to recover, and we must replace those jobs with renewables jobs.

I will take Liam Kerr’s intervention now.

Photo of Liam Kerr Liam Kerr Ceidwadwyr

Kevin Stewart said earlier that £500 million had been invested in the just transition fund. I had to force the First Minister to correct the record last time he misled the chamber to avoid embarrassment for Kevin Stewart. How much has actually been invested in the just transition fund to date?

Photo of Gillian Martin Gillian Martin Scottish National Party

I am always here to spare any embarrassment for my colleagues. The total support for offshore wind in Scotland next year is £87 million, which is being committed as part of that £500 million.

Photo of Gillian Martin Gillian Martin Scottish National Party

If Liam Kerr had taken my intervention, I would have been able to get that sorted out earlier.

In all my meetings with industry, I have had very positive conversations on the challenges that we have set—collectively, as a Government and as a society—for the North Sea operators on their just transition planning. They are making business decisions to invest in renewables. We just have to look at the collaborations that are coming together on the ScotWind licence options to see that oil and gas companies are working hand in hand with other energy producers to deliver on floating offshore wind projects.

The strategic investment of £15 million to anchor our supply chain has been mentioned. That supply chain, which has grown up with and supported oil and gas, is already pivoting to support renewables, and will pivot even more as that upward trajectory continues.

In the first two years of our just transition fund, we have committed £5.5 million to help energy workers to reskill and to build confidence in the potential of the just transition. I imagine that the industry would have been delighted had the UK Government matched our funding in its budget earlier today, so it is a shame that that did not happen.

I want to mention some members’ contributions. I was very pleased when UK Labour said that it would invest £28 billion in green investment. I have to be honest—I was probably as disappointed as my Labour colleagues would have been when that was taken off the table. Dropping that commitment is a big mistake politically for Labour. I really hope that, should Labour be in government after the next general election, it will look at that again. That investment is owed to the people of Scotland in particular, notwithstanding some of the points that have been made by Labour colleagues today.

Liam McArthur spoke about the need for substantial investment in the grid. I fully agree with him. However, as Ivan McKee and Bob Doris pointed out, the elephant in the room is that successive UK Governments have wasted the revenue from the oil and gas sector in Scotland.

I feel slightly sorry for Douglas Lumsden today. At around midday, the wind must have fallen out of his sails when he realised that he would be fronting up a debate on oil and gas after his London masters had decided to continue to use oil and gas as a cash cow while letting off the hook many other sectors and companies that are making obscene profits.

The Presiding Officer:

The minister must conclude.

Photo of Gillian Martin Gillian Martin Scottish National Party

Scotland funds the UK project once again, but, devastatingly, Douglas Lumsden is left in no doubt that the Scottish Conservatives have no influence with their UK leadership. I accept that the UK Conservatives ignore the Scottish Government—we are used to it. However, for them to ignore the Scottish Conservatives—my goodness! That must really sting.

Photo of Maurice Golden Maurice Golden Ceidwadwyr

As we have heard today, our oil and gas sector is one of Scotland’s key economic engines. That point was made well by my colleagues Douglas Lumsden, who spoke about working for the workers; Tess White, who highlighted the need for energy security and a well-managed transition to renewables; and Stephen Kerr, who spoke vociferously, as ever, about the importance of investment.

Listening to the debate today, I believe that almost everyone understands how important oil and gas are to Scotland. We all agree that the North Sea is a mature basin and that there must be a transition to renewables, but that only makes it all the more difficult to understand the positions of the other parties. The SNP happily supports a presumption against new exploration, while Labour has come out and said that it will not grant new licences.

Photo of Daniel Johnson Daniel Johnson Llafur

It is clear that we will honour existing licences. Furthermore, given that the UK Government is continuing with the windfall tax, would it not be better to use that money to fund a transition rather than a tax giveaway because the Conservatives are desperate and rather concerned about the next election?

Photo of Maurice Golden Maurice Golden Ceidwadwyr

We have heard today from the Labour Party that there will be no new licences. That is a dereliction of duty when it comes to the north-east and the rest of Scotland. Meanwhile, the Greens—ever the most extreme voices in Parliament—have boasted of wanting to end Scotland’s oil and gas industry altogether. What those parties do not seem to understand, or perhaps do not want to admit, is that those policies are based on a false proposition. We know from the Scottish Government’s just transition review of the Scottish energy sector that North Sea production is declining faster than is required to keep global warming to 1.5°C, so new licences will have a minor—even a negligible—impact on our net zero efforts.

Yes, fossil fuels are the largest source of global carbon emissions, and, yes, we must tackle them if we are going to reach net zero. However, we cannot stick our heads in the sand and pretend that oil and gas will not be a key part of our economy for many years to come, especially given that the SNP and the Greens are nowhere near achieving their target of 50 per cent of energy consumption coming from renewables by 2030. Clearly, we need better effort to reduce long-term demand. While that is going on, we should also ensure that our supply is as low carbon as possible. As it happens, the carbon intensity of North Sea production is below the global average. In fact, natural gas from the UK continental shelf produces less than half the emissions of imported liquefied natural gas, so sourcing supply from the North Sea should be the first choice for Scotland.

Photo of Gillian Martin Gillian Martin Scottish National Party

Does the member recognise that we want to support existing production by the INTOG—innovation and targeted oil and gas—leasing round, which is helping to further decarbonise the current production of oil and gas?

Photo of Maurice Golden Maurice Golden Ceidwadwyr

There are lots of benefits to INTOG, but it has been held up by Scottish Government delays in planning. That needs to be looked at urgently to ensure that we build up the supply chain in advance of ScotWind.

The public agrees with the support for oil and gas. A poll last year found that the overwhelming majority of Scots—some 75 per cent—want demand to be met from domestic supply. The alternative is to increase imports, potentially from higher-emission sources, which, in turn, potentially will drive demand for those higher-emission basins.

Given that the SNP has failed to reach eight out of its last 12 legal emissions targets, you would think that it would want to avoid causing further environmental damage.

There is also an economic and social impact of demand reduction to consider—something that those of us who have the privilege of representing north-east communities are acutely aware of. A rapid shutdown, such as the Greens suggest, can only inflict unnecessary suffering on those communities, potentially costing everyone in Scotland as much as £1,100 each by 2030. Managing demand reduction over the long term provides the opportunity to ensure a just transition for oil and gas workers.

Photo of Audrey Nicoll Audrey Nicoll Scottish National Party

I notice that the motion does not mention the increasing cost of extracting oil and gas, which the minister referred to in her contribution. What is the member’s message to the sector that faces that situation?

The Presiding Officer:

Maurice Golden—in conclusion, please.

Photo of Maurice Golden Maurice Golden Ceidwadwyr

Unlike Audrey Nicoll’s message, my message to the sector and to the world is that the north-east and Scotland are open for business and we want your jobs and investment here.

Overall, what we need is a pragmatic approach to oil and gas—one that is rooted in the real world and is best placed to get us to net zero while protecting Scottish jobs and growing our economy. We can only hope that the Scottish Government pays heed instead of being dragged to further extremes by the Greens.

The Presiding Officer:

That concludes the debate on backing Scotland’s oil and gas sector.