The UK government has launched a consultation on the North Sea's "clean energy future", seeking to balance "continued demand for oil and gas" with the natural decline of the North Sea basin, the country's energy security and climate science.
The government has proposed an end to new onshore oil and gas licences in England — as onshore licensing is a devolved matter — and once again confirmed its manifesto pledge for no new oil or gas licences for North Sea exploration. It also confirmed a previous commitment to end the so-called windfall tax on oil and gas producers in 2030.
Further oil and gas licences "would not meaningfully increase UK production levels, nor would they change the UK's status as a net importer of oil and gas", the government said. It flagged the North Sea basin's maturity, which means that an absence of new licences makes only "a marginal overall difference to future North Sea production".
The "vast majority of future production is expected to come from producing fields or fields already being developed on existing licences", the government said. It noted that while offshore licensing rounds have resulted in up to 100 permits each time, under 10pc of recently issued licences "have progressed to active production".
But its halt on new exploration licences would not preclude any licence extensions being granted, the government said. It aims to provide "certainty to industry about the lifespan of oil and gas projects by committing to maintain existing fields for their lifetime". The decision does not affect the issuing of new gas or carbon storage licences, it added.
Focus on 1.5°C
The consultation also doubles down on the government's previous commitments to "clean power" by 2030 — which would entail a small role for gas-fired power generation, of under 5pc — and its determination to be a leader in climate action.
"The science is clear that the world needs to take urgent action and that current plans for global production of oil and gas are not compatible with limiting global warming to 1.5°C," the government said.
The Paris climate agreement seeks to limit global warming to "well below" 2°C above pre-industrial levels and preferably to 1.5°C.
The government has requested views on its plans to ensure a "prosperous and sustainable transition for oil and gas" and to make the UK a "clean energy superpower", focused on technologies such as offshore wind, hydrogen and carbon capture, use and storage (CCUS). This will boost the UK's economy and energy security, the government said. "Clean energy" is key for energy security, as a reliance on fossil fuels leaves the UK at "the mercy of global energy markets", it added.
"CCUS will be a critical component of the UK's energy transition," the government said. It also noted the geological advantage the UK holds for CO2 storage. There is "significant potential for CO2 import", likely from Europe, it said.
The government has also sought extensive feedback on the transition for the country's oil and gas workforce. An "offshore renewables workforce" could stand at between 70,000 and 138,000 in 2030, it said, while oil and gas jobs are set to decrease, alongside the North Sea's fossil fuel production.
Today's consultation will close on 30 April. And the government will publish its final guidance on an updated environmental framework for oil and gas "in good time", it said.
