Portfolio Question Time – in the Scottish Parliament am 2:00 pm ar 21 Tachwedd 2024.
To ask the Scottish Government what its response is, regarding any implications for its energy strategy and just transition plan, to the reported announcement by Apache that it will cease all operations in the North Sea by the end of 2029. (S6O-03996)
We are aware of reports of that disappointing commercial decision by Apache. As we finalise the energy strategy and just transition plan, we are committed to working in partnership with industry to deliver a just transition for Scotland’s valued oil and gas sector that recognises the declining nature of the North Sea basin but is also in line with our climate commitments.
As part of that, we continue to call on the United Kingdom Government, which holds key levers around the fiscal and regulatory regimes, to listen very carefully to the concerns that have been expressed by business on risks to jobs and investment in that transition.
Many North Sea firms now feel existentially threatened by the damaging anti-industry narratives of both Scotland’s Governments. Scottish ministers promised us an energy strategy in spring 2022 and then summer 2024, yet we still have no date for publication. Will the minister give us a clear publication date for the strategy, and will she promise industry that the demonising mantra of “presumption against” will not feature in it?
In my view, as long as there is demand for fossil fuels in the United Kingdom, we should be meeting as much as possible of that demand from our domestic supply in the North Sea. It is up to us to reduce our demand.
It is notable that Apache singled out the energy profits levy—EPL—as a reason for its departure. That is a UK policy that was brought in by the former Conservative Government.
As far as I am concerned, we have to make sure that our energy strategy and just transition plan are as robust as possible. We are committed to publishing them as soon as we can. However, as Liam Kerr will know, there is a discussion to be had with the UK Government, which intends to consult on future approaches to new licensing for oil and gas, potentially refining the position. We want to play our part in that discussion. We believe that we have a nuanced and sensible approach, which looks at licensing on a case-by-case basis, includes robust climate compatibility assessment and considers energy security.
We have shown our commitment to the industry by assisting it in reducing its production emissions through the innovation and targeted oil and gas—INTOG—round of licensing for floating offshore wind.
The UK Government’s energy plans are causing an energy exodus from the north-east. Labour’s flagship project GB energy will now receive only £100 million of funding over its first two years—that is nothing like the £8 billion that was pledged.
Can the cabinet secretary provide an update on what engagement it has had with the UK Government on the concerns that businesses are expressing about risks to jobs and investment in the transition because of the changes to the energy profits levy and the allowances regime?
Scottish ministers engaged with UK counterparts on a number of matters in the run-up to the autumn budget. For example, the Acting Minister for Climate Action, who is sitting beside me, met the under-secretary of state for energy in Aberdeen on 17 September. We continue to urge the UK Government to listen carefully to businesses on the ground about the impacts of the EPL on jobs and investment during the transition.
The UK Government also needs to work with industry to set out a stable, long-term fiscal regime to give the sector the much-needed certainty and stability that it deserves.
Thank you, cabinet secretary. That concludes portfolio questions on net zero and energy, and transport. There will be a brief pause to allow a change of members on the front benches before we move on to the next item of business.