Fears are growing for the future of 100,000 jobs in the North Sea energy industry, with two of Scotland’s top business figures adding their voices to concerns there may be only 100 days after the General Election to save the sector.
Sir Tom Hunter and Lord Willie Haughey have red flagged the Aberdeen & Grampian Chamber of Commerce’s 39th Energy Transition survey, which shows there has been a sharp drop in North Sea production and exploration as potential investors await the outcome of the election on July 4.
Speaking on their Go Radio Business Show, Sir Tom said: “Aberdeen & Grampian Chamber of Commerce has warned that whoever will be in government after the election has about 100 days to save 100,000 jobs.
“They’re very worried about windfall taxes and a changing environment up there. They’re saying they need clear guidance. I don’t know what the political parties’ views are on this, but 100,000 jobs sounds pretty serious to me.”
The Energy Transition report shows industry confidence in UK activities has plunged to a record low, highlighting the primary causes as high taxes and a potential exploration ban – both, it says, threaten to prematurely end the domestic oil and gas industry.
With a leading investment bank already warning up to half of the direct and indirect jobs supported by the North Sea could be lost within five years, the Chamber estimates the party that wins the General Election has only 100 days to restore confidence or face losing investment worth £30 billion.
“To be fair, it sounds a wee bit alarmist,” said Lord Haughey. “These 100,000 jobs are not going to disappear overnight. However, I do agree with the sentiment that they need certainty.
“They need to know where they stand because, if not, you have to pivot, you have to make changes.
“The people in the northeast deserve to know. There’s been a great contribution made into the wealth of Scotland through all the hard work by the people up in the northeast, especially from those in the oil and gas industry. So I hope they will find those answers within the 100 days.”
Labour leader Sir Keir Starmer, meanwhile, has rejected claims his party’s stance on oil and gas – it will not allow new licences for exploration, if he becomes Prime Minister – would cost North Sea jobs.
However, against this backdrop, Aberdeen & Grampian Chamber is making fresh calls for an independent body, free from political influence, to oversee the UK’s energy transition.
Looking to the future prospects for the northeast after July 4, Sir Tom noted: “I would like whoever it is in power to go up to Aberdeen to understand what’s really happening in the energy markets.
“I’d like them to speak to people such as Sir Ian Wood and Bob Keiller – people who really understand what a just transition to net zero could be. I want them to set out a clear policy that saves the jobs. This is a transition over a number of years but one that sets Scotland up to be a world leader in net zero.”
Reflecting more widely on the transition to renewable energy, he added: “There’s a bit of good news at Hunterston marine yard in Ayrshire. The owners there, Peel Ports Clydeport, are going to invest £150 million.”
Peel Ports is readying the site in preparation for major offshore wind projects and has submitted a formal planning application and competitive tender process. The redevelopment is part of a transformation of the former coal terminal into a renewables hub.
“So this is about moving from one energy source and into renewable offshore wind,” said Sir Tom. “They want to make Hunterston a centre for that . . . and that has to be applauded.”
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