UK Conservative leader blasts current North Sea policy

Kurt Abraham, Editor-in-Chief, World Oil 

Fig. 1. UK Conservative Leader Kemi Badenoch, MP. Image: official portrait.

One thing is certain: If you see British federal officials and other politicians making a pilgrimage to Aberdeen in volume during late summer, chances are high that the area’s bi-yearly spectacular, Offshore Europe, has gotten underway. And that is exactly what is happening again this week. 

Offshore Europe’s first-day plenary session was highlighted by Opposition Leader, Conservative Member of Parliament Kemi Badenoch, delivering a somewhat fiery speech in favor of maximizing the UK North Sea’s potential, Fig. 1. Early in her remarks, Badenoch began building her case by noting that “oil and gas still account for three-quarters of UK energy needs.” Furthermore, said Badenoch, Norway had its biggest discovery in 10 years, “while we are leaving our resources untouched. We are sabotaging ourselves and had the lowest oil production in [nearly 50 years]. We’ve got to get that oil and gas out of the ground.”

Continuing the litany of problems that are ensuing from the policies of Prime Minister Kier Starmer, Badenoch said that a thousand jobs are disappearing from the UK oil and gas sector every month. She said, “the tax surcharge is actually leading to less tax revenue. There is no windfall left, but Labour keeps taxing. Almost every other country has dropped its levy, but Labour wants it to continue until 2030.

Trying to support her contention, Badenoch explained that more North Sea gas production would mean more Europeans buying from Aberdeen instead of Moscow. Clearly appealing to the audience’s concerns about their livelihoods, she contended that only the Conservative Party is fighting for the oil and gas industry. Accordingly, she proposed one clear mission for the North Sea Transition Authority that supervises the region’s activity—maximize North Sea production.

Fig. 2. OEUK Chief Executive David Whitehouse. Image: OEUK.

“We will judge operators on one thing—how much they produce,” continued Badenoch. “We also will change the name of the NSTA to just North Sea Authority. Without investment now, the UK will be importing 80% of its oil and gas, leaving us open to supply squeezes. The economy must come first. It’s about whether Britain grows or declines.”

The Conservative leader declared that the regulatory system is “strangling the North Sea.” Indeed, she is correct in saying that the Labour regime refused to grant new exploration licenses. In contrast, she called for the scrapping of the Net Zero requirement for drilling rigs. 

Badenoch said she is proud of the technology being achieved in Scotland, despite the Starmer administration. “The Norwegians encourage their industry,” she noted. “Labour discourages our industry.” And as for decarbonization, which she said Conservatives are not against, the leader stated that “Britain has decarbonized more than any other country since 1990.”

Other plenary speakers. The morning session got started with some welcoming comments from Offshore Energies UK Chief Executive David Whitehouse, Fig. 2; David Cameron, Lord Provost and Councillor of Aberdeen; and SPE’s 2026 president, Jennifer Miskimins. Whitehouse noted that Offshore Europe this year “has attracted a record number of presentations.” In a clear prelude to Badenoch’s remarks, Whitehouse said that “while we (the UK) use oil and gas, we must prioritize our own (production).” In one of the more dramatic moments of the morning, Whitehouse asked the crowd to rais their hands if they know someone who has lost his/her job or someone, who has graduated and can’t find a job. Somewhat amazingly, probably three-quarters of the crowd put their hands up, to which Whithouse implored attendees, “please back home-grown energy.” 

Fig. 3. Louise Kingham, Senior Vice President of Europe and Head of Country, bp. Image: bp.

Delivering the morning keynote address was Louise Kingham, Senior Vice President of Europe and Head of Country for bp, Fig. 3. She said that the last few years have been particularly challenging. “The pandemic and Russian invasion of Ukraine show that we can’t take energy security for granted.”

Nevertheless, Kingham enunciated a list of advantages that the Scottish region has working for it:

1. It is still one of the world’s most prolific hydrocarbon basins. While production is declining, “there is still plenty of life left in it. The world is in a state of energy addition.
2. The geology of the region is great for carbon storage.
3. She called Scotland offshore a great region for offshore wind generation of electricity.
4. The North Sea can be a viable hydrogen hub.
5. The industry is not starting from scratch.
6. The size, proximity and structure of the regional market are beneficial.

By the same token, Kingham said that the region and industry face some challenges:

1. The clock, she said, “is ticking on the ambitions that we set for ourselves. We only have 25 years to meet the Net Zero ambitions.”
2. The world, she says, is a complicated place. Oil and gas demand is not dropping off as quickly as some people had expected.
3. “Money is in short supply. Every country must be disciplined” in using its resources.
4. As a sector, oil and gas is competing with every other business sector for talent.

Fig. 4. Parliamentary Under-secretary of State for Energy, Michael Shanks, MP. Image: official portrait.

Her recommendations for “competitiveness include: 

1. Fiscal and regulatory frameworks must be compatible with the market worldwide. “We need to move forward apace.”
2. The industry must continue to implement new technology across all sectors.
3. To keep energy flowing, companies must continue collaboration, JV projects and new ventures.

Finishing off her remarks, Kingham said, “The North Sea is a gift, right on our doorstep. We must make the most of it.”

Labour’s perspective. Following Kingham in addressing the crowd was Parliamentary Under-secretary of State for Energy, Michael Shanks, MP (Fig. 4) and one of the youngest speakers in the plenary. Shanks said that he undertook his current position in the Starmer administration with two promises: “I will always be genuinely interested. And I will always be honest.”

He declared that “now is the time to build the North Sea’s future. And now is the time to invest.” In building up the North Sea’s resources and infrastructure, Shanks said that “it was the ingenuity and leadership of our industry that led the way forward.” Acknowledging that there are different points of view on how to move forward at this point in time, the under-secretary observed, “this cannot ever be a binary choice between one energy form or another.”

Trying his best to appeal to unity, Shanks said, “We need to talk about harnessing the North Sea’s potential. We owe it to this community and its offshore workers. We also must not talk down the potential of offshore renewables.” The latter statement seemed to be a swipe at Donald Trump and his administration without actually mentioning the U.S. president. It was one of several complaints about certain people not appreciating offshore renewables that seemed to be targeting Trump, as well as various conservatives.

Top image: Offshore Energies UK (OEUK)