The leading representative body for the UK offshore oil and gas industry has launched a survey in a bid to help find solutions to the problems faced by the supply chain as it deals with the impact of the coronavirus pandemic and low oil and gas prices.

A comprehensive set of questions covering offshore activity levels, the financial position of companies, employment levels and plans, investment and feedback on steps that can be taken by industry and government to support the sector was issued to the hundreds of OGUK member companies in the industry’s supply chain who range from larger contractors to small and medium sized enterprises.

The results of the survey will inform the details of a COVID 19 Sectoral Resilience Package being put together by industry to propose to governments in the coming weeks. It will build upon the already extensive support offered by governments to companies and self-employed workers and is intended to directly address sector-specific issues. This includes what has come to be known as the stranded middle: companies who currently would not be eligible to apply for the Coronavirus Business Interruption Loan (CBIL) Scheme or the COVID-19 Corporate Financing Facility (CCFF).

On Wednesday, BEIS Energy Minister Kwasi Kwarteng joined OGUK’s contractor council to hear first-hand the challenges facing the sector.

Last night in line with requests from OGUK, the UK government announced it has introduced a  Coronavirus Large Business Interruption Loan Scheme (CLBILS) which will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £500 million.

OGUK today said it hopes to announce further details on its proposals in the coming weeks.

Commenting, OGUK Supply Chain Director Matt Abraham said:

“Our supply chain is facing pressures in the extreme. The operational impact of the coronavirus pandemic, low oil and gas demand and low prices mean an uncertain future for many. This triple whammy of concern comes only as many were just starting to emerge from the impact of the previous prolonged downturn. Last night’s announcement from government is welcome and confirms it is listening and responding to feedback, however there are still specific issues with regards to support for the oil and gas sector which OGUK is working to address with both UK and Scottish governments.

“We’re hoping this survey will give us a clear idea of where governments and regulators can offer specific help that will really make a difference and we’re urging all of our members in the supply chain to take part. In the coming days and weeks, we’ll put forward to government our proposals for a COVID19 Sectoral Resilience Package and look forward to continuing what has been a positive and constructive dialogue. We’re grateful to the CBI particularly for their support in developing our proposals – remaining joined up across industries is critical as we look to protect jobs and businesses.”

Information for the industry about COVID-19 is available at www.oilandgasuk.co.uk/covid-19

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OGUK, the leading representative body for the UK’s offshore oil and gas industry and Step Change in Safety, the industry’s recognised safety organisation, have co-produced a series of films to address the concerns of thousands of workers travelling offshore during the coronavirus pandemic.

There are currently two films available to view with the first co-presented by OGUK’s aviation advisor, Graham Wildgoose and Matt Rhodes, Bristow Helicopters UK and member of the Step Change in Safety Leadership Team. Together they address aspects of helicopter travel including operational procedures, arrival and departure protocols, and the transfer of passengers.

The second film features OGUK’s medical advisor, Dr Graham Furnace providing answers to questions regarding the workforce’s concerns around current coronavirus-related medical and health issues. Topics he covers include temperature checking, measures to take when temperatures are high and self-isolation offshore.
The films also feature contributions from OGUK Chief Executive Deirdre Michie and Step Change in Safety Executive Director Steve Rae, who in a joint statement published today, said:

“Our industry has health and safety at its core and in adjusting to the impact of the coronavirus pandemic, we’ve all had to make radical changes to the way we live and work. For many the new normal is working from home, but for thousands of people in our industry going to work means travelling by helicopter offshore to help meet our daily energy needs.
The means by which we prepare for, and undertake, these journeys has had to change. These essential changes are by design intended to provide additional barriers to protect against the spread of this virus offshore, allowing us to continue to provide continuity of energy supply to support the vital work that all key workers are undertaking to protect the health and wellbeing of our nation. With that in mind it is our duty to ensure that our workforces concerns are responded to in a timely and factual manner.

“These films are part of a series to support our workforce with comprehensive information about travelling offshore when they most need it.”

Two films are now available to view on both the Step Change in Safety and the OGUK websites here.
www.stepchangeinsafety.net/covid-19
www.oilandgasuk.co.uk/covid-19

April 1 marks the 11th anniversary of the helicopter flight 85N accident in which 16 people lost their lives . Every year since, family members, friends and colleagues of those lost have gathered at the memorial in Johnston Gardens Aberdeen to remember those lost. Due to the coronavirus, people are unable to physically come together so the industry’s chaplain, Reverend Gordon Craig has provided a short, recorded act of remembrance online which can be accessed here https://youtu.be/e6ZXS0hXAnE

Ends

 

OGUK, the leading representative body for the UK’s offshore oil and gas industry has teamed up with Step Change in Safety, the industry’s recognised safety organisation to offer support to the tens of thousands of workers keeping the UK running with secure and affordable energy during the coronavirus pandemic.

A new dedicated online hubs with guidance, videos and FAQs has been launched to provide everyone involved in the industry, and their families, with a “one stop shop” to address concerns on the prevention and protection against coronavirus in around 150 manned installations across the UK Continental Shelf (UKCS) and the substantial onshore workforce. Both organisations are working jointly to provide the most accurate information about topics and services such as offshore helicopter travel, health screening and training re-certification. It is available on Step Change in Safety and OGUK websites

In a joint statement published today, OGUK Chief Executive Deirdre Michie and Step Change in Safety Executive Director Steve Rae said:

“Our industry workforce plays a critical role in providing the energy and products the UK needs to power hospitals and make essential trips. Our message to our people is clear: you are doing an essential job in keeping us safe and warm, and we need to work together to keep you safe at work.

“Working tirelessly with governments, regulators and our industry we have secured clear arrangements on the safe removal of suspected cases from offshore, on establishing our workforce as key workers so they can continue to send their children to school if they have to and to continue to travel to work and on temperature testing as standard at all heliports.

“We continue to work with governments to make the case for testing of offshore personnel, and now, more than ever before, we will be supporting our workforce to feel and be safe as they carry out their essential work. It’s why today we are combining strengths in launching a dedicated online hub with guidance, videos and FAQs. We will continue to encourage the participation of the unions, the regulator, and our members to work together in circumstances that are completely unprecedented.”

The UK offshore oil and gas industry which plays a vital role in the security of energy supply for the nation has been severely hit by the triple impact of COVID-19, the oil price crash and the lowest gas prices in the last ten years.

With many businesses facing a fight for survival, industry body OGUK, that represents over 400 companies has welcomed the UK Government’s announcement of help for both workers and companies.

Deirdre Michie, Chief Executive of OGUK said:

“Many of the companies in our industry, especially in the supply chain, are still financially fragile after the previous oil price crash, so the triple whammy we now face is particularly dangerous. In that context the strong response from the UK Government and their clear determination to support both workers and companies is very welcome. It is now crucial to ensure companies can easily and rapidly access this money as for many businesses and individuals cash flow is now vital.”

Companies in the UK offshore oil and gas industry contributes around 50% of UK gas which is used for a large proportion of our electricity production and which heats the vast majority of our homes. They also produce a major proportion of the oil that fuels our cars and is used in the manufacture of a huge proportion of the items we use in our daily lives from contact lenses and toothbrushes to the lightweight cases on our mobile phones. Companies in the UK industry are also backing the UK drive to net zero emissions and have also been working on technology to help us get there.

OGUK has today welcomed the UK Government’s announcement that oil and gas workers are included on a list of key workers whose children will be prioritised for education provision.

Commenting, OGUK Chief Executive Deirdre Michie said:

“As an industry we are committed to doing everything possible we can to help the country and our businesses and our people through this devastating crisis and we appreciate the announcement today on access to education. We’re working closely with government to resolve any challenges we face to maintaining safe operations for our people and ultimately ensuring we can continue to provide the UK with secure and affordable energy.”

Find the latest updates on here

Effective project management is the topic under scrutiny at the first Efficiency event of 2020, which OGUK and the Engineering Construction Industry Training Board (ECITB) will co-host via a webinar on March 24.

Anyone keen to improve project management performance can dial in to a breakfast-time web-based seminar focusing on the ECITB’s recently updated Project Collaboration Toolkit, will highlight the benefits and efficiencies that collaboration can deliver.

Emily Taylor, OGUK’s Continuous Improvement Manager, said:
“The combination of the global economic impact of the continued spread of the coronavirus, the most dramatic fall in oil price in almost 30 years and a halving of gas prices is placing extraordinary pressures on our industry. We’re focusing on everything we can do to share knowledge that helps protect our industry, enabling its sustainability and resilience in extremely difficult conditions while underpinning collective efforts to deliver a net-zero oil and gas basin.
Evaluation of activities on the UK Continental Shelf between 2011-2016 demonstrated how inefficient project management contributed to costly budget overruns of up to 35% and delays in delivery. The Efficiency Task Force’s role in seeking out, promoting and providing access to efficient practice across the industry with tools like OGUK’s Robust Project Delivery Guidelines and ECITB’s Collaboration Toolkit is making a difference, with project delivery performance improving in 2018 so this webinar is a great opportunity learn more.”

Chris Claydon, Chief Executive of the ECITB, said:
“The Project Collaboration Toolkit has demonstrated its value to the UK oil and gas industry since its launch because by sharing skills and expertise across projects we see improved efficiency and productivity.
“It’s already been used successfully on several projects in the upstream and downstream sector, such as Shell’s Brent Bravo, where smaller project teams worked collaboratively to deliver the project on time and at reduced cost. “It is also used as a resource by Robert Gordon University to teach the project managers of tomorrow about the process of collaborative working.
“There’s no doubt that supply chain collaboration is critical to transforming the business performance of the UKCS and the toolkit is a valuable resource for project managers.”

The webinar ETF is presenting in collaboration with ECITB to showcase efficiency opportunities in project management, will start at 8.30 am and will feature the following speakers:
• Phil Simon, ETF chairman
• Chris Claydon, CEO ECITB
• Neil Rogerson, Engineering Director, Epro-Subsea
• Dan Mcateer, Head of Project Management, Worley
The presentations will close at 9.30am following a Q&A session

Ends

Notes to Editors:

1. Further information on the event can be found here

in collaboration with ECITB to showcase efficiency opportunities in project management, will start at 8.30 am and will feature the following speakers:

  • Phil Simon, ETF chairman
  • Chris Claydon, CEO ECITB
  • Neil Rogerson, Engineering Director, Epro-Subsea
  • Dan Mcateer, Head of Project Management, Worley

The presentations will close at 9.30am following a Q&A session

Ends

The combination of the global economic impact of the continued spread of the coronavirus, the most dramatic fall in oil price in almost 30 years and a halving of gas prices is driving an increasingly fragile outlook for the UK’s offshore oil and gas sector. Severe pressures are already building across the sector’s supply chain, with the pressures expected to significantly undermine the industry’s businesses, jobs and contribution to the economy.

The stark warning was made today by the leading representative body for the sector OGUK, in the first in a series of Business Outlook reports which will shine a light on the issues facing the sector in a challenging and dynamic business environment.

The Business Outlook: Markets and Investment report shows OGUK now expects drilling levels to fall back to the lows experienced in 2016, down more than a third on previous forecasts. The report also warns of a possible 20-30 percent decrease in capital investment for 2020 as well as the potential that the operators in the sector will experience negative cash flow this year.

While the industry was only beginning to emerge from one of the most prolonged and severe downturns in its’ history, OGUK said the supply chain had remained under significant pressure, with tight margins and relatively low activity levels.

OGUK today called for government support to ensure the sector can continue to provide security of supply in the face of these extraordinary difficulties. The body also said it was working with industry, regulators and government to understand how it can protect supply chain companies, and jobs.

OGUK Chief Executive Deirdre Michie said:

“Businesses and industries across the UK are facing extraordinary pressures but coming so soon after one of the worst downturns in our history, this report shows that this sector is now in a paper-thin position.

“The offshore oil and gas sector is part of the UK’s critical infrastructure, providing the secure and affordable energy the country needs and is  a key contributor to the economy in terms of supporting hundreds of thousands of skilled jobs, businesses and our wider economic contribution.

“Action is needed now to ensure the sector doesn’t lose the skills, experience and infrastructure it needs to meet the UK’s energy needs of today as well as help deliver its net zero ambitions in future.  We appreciate the Chancellors recent statement and OGUK is requesting urgent meetings with ministers to consider a COVID-19 Sectoral Resilience Package which would help to give some reassurance to the regions, businesses and jobs this industry supports.

“We’re already working with our members to understand the challenges businesses are facing in these unique and extremely worrying times.”

OGUK Market Intelligence Manager Ross Dornan said of the report:

“The first week of March saw the most dramatic fall in oil price in almost 30 years and it remains uncertain as to how the market is going to evolve in the coming months as the coronavirus impact increases each day.

“Alongside this, the gas price has more than halved in the last 12 months, and we face a situation where E&P production revenues are set to be almost 50 percent lower than they were  two years ago despite the same level of output.

“The UKCS has seen significant improvement in its competitiveness, efficiency and productivity in recent years. These improvements will help performance, however in this harsh environment we expect companies to take significant steps to preserve cash flow and ensure business continuity. This will have a very negative impact on the supply chain, which has not yet seen much recovery from the previous downturn and doesn’t have the capacity to absorb much more pain.

“Companies are increasingly diversifying into other energy sectors and across industries more generally, but many cannot diversify or are too early in their journey to provide adequate protection/buffer. At this time innovative thinking, partnerships and meaningful collaboration will be required to help as many as possible to weather the storm.”

OGUK Health, Safety and Environment Director Trevor Stapleton said:

“OGUK continues to work with our members to share official advice on coronavirus (COVID-19) from the relevant bodies to ensure the health of the people in our industry.

“This sector is experienced in managing risks associated with complex safety and health matters, with robust processes and arrangements in place to ensure effective prevention measures and response for both onshore and offshore operations. The challenges of managing health in a remote environment are understood and industry has long-established medical facilities and personnel onboard, supported by a topsides doctor onshore.

“In addition to following official advice and in support of members, OGUK has over the past weeks facilitated industry discussion with the appropriate agencies on how best to understand, manage and respond to the challenges this novel virus poses, ensuring information is shared. This includes our regulator, the HSE, and the relevant public health bodies.

“As with confirmed cases onshore, in the event of a confirmed case offshore, the affected operator will work with the relevant agencies to risk assess the specifics of the situation and ascertain the appropriate response. OGUK continues to work with all our members and stakeholders to share information.”

General Update:

Following the WHO confirmation yesterday that COVID-19 is a pandemic, the UK government is expected to move into the next stage of response shortly.

This may mean significant changes to the way we work and socialise, and most importantly the way we individually act to minimise the spread of infection.

All members are encouraged to stay up to date with and continue to follow government advice on responding to COVID-19 and to communicate with their workforce and supply chain on how that advice is being implemented in their operations.

There is wide-ranging advice on many topics available from Public Health England and Health Protection Scotland on how best to minimise transmission of the virus within the workplace. This advice is revised and new guidance produced continuously as more is learned about the virus.

Regularly updated guidance and resources can be found on the following web pages:

https://www.gov.uk/government/collections/coronavirus-covid-19-list-of-guidance

https://www.hps.scot.nhs.uk/a-to-z-of-topics/covid-19/

UK agencies are co-ordinating to ensure that advice is consistent across the country.

OGUK Pandemic Steering Group

OGUK has convened an industry Pandemic Steering Group, which is made up from representatives from across the sector and is tasked with identifying and addressing the particular challenges faced by those working to maintain offshore operations at industry-level and ensuring communication with relevant stakeholders and government agencies.  The group is tasked with focusing only on those issues which require cross-industry action and co-ordination.

The PSG is meeting regularly and updates are being shared with our technical groups. It is not tasked with providing updates and advice on operational response. Member companies are implementing their individual pandemic response and business continuity plans to ensure that industry can respond effectively.

OGUK will share industry-specific advice as it becomes available and enable sharing of lessons learned as members gain experience in dealing with the specifics of this pandemic.

Industry Travel Policy for Offshore Installations

Given the challenges of managing any confirmed case of COVID-19 on an offshore installation, industry policy is to have restrictions on workers travelling to offshore installations. Industry policy is that personnel will not be permitted to travel offshore if:

  • They have travelled from or transited through affected countries in the last 14 days, or since dates defined on the UK government’s list of affected areas.

This includes both Category 1 and Category 2 areas (up to date lists can be found here).

  • If they have been in close contact with a confirmed case of COVID-19 in the last 14 days.
  • If they have experienced symptoms of cough, fever and shortness of breath.

Oil and gas industry travel restrictions apply to fixed and mobile offshore installations. It is not intended to apply to vessels involved in the offshore oil and gas industry.

In light of the developing spread of COVID-19 (Coronavirus) in the UK and elsewhere, the team at OGUK has been evaluating the Business Outlook Report launch events planned to take place on Wednesday 18 March and have now taken the decision to cancel the breakfast briefings in both Aberdeen and London.

OGUK prides itself in providing excellent market intelligence valued by our members, the wider industry and our stakeholders. Given the rapidly changing commodity price environment in which we now find ourselves, and the potential implications across the industry, we’re also taking the opportunity to re-evaluate the content of the Business Outlook report and over the coming weeks publish a series of smaller reports to best capture what is a dynamic business environment.

We’d like to thank you for your understanding on the constraints that are being placed on events and meetings. We appreciate your plans for the events would have been underway and apologise for any inconvenience caused. The ticket that you have purchased for the breakfast will be refunded.

In replacement of the breakfast events, we are progressing plans to host a webinar with industry panellists and will share details of this with you in due course – we do hope that you will be interested in supporting our virtual event.

We are sorry to have had to take this decision but hope that you can appreciate our reasoning and we look forward to welcoming you to future OGUK events in 2020.

 

OGUK has today (Tuesday, March 3) confirmed it has taken the decision to postpone a number of its events this year in light of the developing spread of coronavirus.

The below events will be postponed, and new dates will be released in due course:

•            Share Fair, March 24th, Aberdeen

•            Doctors’ Training Workshop, April 1st, Aberdeen

•            D&I Conference, April 23rd, Aberdeen

•            Examining Doctors’ Conference, May 7th, London

OGUK said the safety of its members and visiting delegates was of the upmost priority and it will communicate the rescheduled event dates in due course, with a replacement ticket issued to those who had already purchased.

Gareth Wynn, OGUK’s stakeholder and communications director, said: “We are continuing to work closely with our members to circulate official advice on coronavirus (COVID-19) from the relevant agencies and will continue to work across the sector to help ensure the health of people in the oil and gas industry.

“Our more imminent Business Outlook Breakfast Briefing events in both Aberdeen and London are expected to go ahead as planned as they attract primarily local audiences and run for a short duration with more limited contact between delegates, however we will continue to monitor the situation and any advice from the health authorities.  

“We will also be communicating additional guidance to all delegates in advance of these events to help mitigate the potential spread of the virus.”

The leading representative body for the UK’s offshore oil and gas sector, OGUK, has highlighted its plan to ensure the sector can help deliver net zero emissions while providing the secure and affordable energy Scotland needs as it transitions to a low carbon future.

It comes in response to an interim report published by the Scottish Government-appointed Just Transition Commission. The commission welcomed the industry’s Roadmap 2035 – one of the first industrial responses to UK and Scottish Government net zero commitments – which sets out over 60 practical actions in five key areas needed to ensure a successful transition.

The report also called for greater engagement with the workforce, steps to ensure reducing emissions does not see high quality jobs leave the country and called for a joined-up approach to ensure all agencies working with stakeholders towards a shared goal.

Responding to the report, OGUK Chief Executive Deirdre Michie said:

“This report shares our industry’s focus on delivering a fair, inclusive and sustainable transition to a low carbon future. These findings confirm the need for continued partnership working with governments, regulators and our people to ensure that we can continue to support the UK’s diverse energy needs, the communities we work in as well as wider society.

“Our blueprint for net zero as outlined in Roadmap 2035 shows a changing industry in action with a credible plan for the future. Delivering the Roadmap means that the sector can contribute to supporting the energy transition as well as providing secure and affordable energy, ensuring hundreds of thousands of jobs and crucially developing the skills and expertise Scotland needs to find solutions to meet net zero ambitions.

“We’re in the early stages of our journey as an industry and a country and this reinforces that we are heading in the right direction. With the continued support of governments and regulators and a shared commitment to Roadmap 2035, we can deliver a successful transition for the people working in our industry and wider society – both now and in future.”

Commenting on the current concerns regarding coronavirus in the UK, Trevor Stapleton, OGUK’s HSE director, said:

“We’re already working with our members to share official advice on coronavirus (Covid-19) from the relevant bodies and will continue to work across the sector to ensure the health of the people in our industry. This sector is well versed in managing risk on complex safety and health matters, with robust processes and arrangements in place to ensure effective prevention measures and response. In addition to following the advice from health bodies and applying relevant procedures, individual operators will also decide further arrangements relevant to their specific needs, including travel and health advice. OGUK remains in regular contact with the relevant authorities to understand any further industry specific advice.”

 

Supply chain companies keen to be among the first to learn about business opportunities will benefit from advance information on major oil and gas projects by participating in OGUK’s Share Fair in Aberdeen on March 24.

As the leading representative body for the UK’s offshore oil and gas industry, OGUK’s popular business development event supports the growth of a resilient, competitive and diverse supply chain. This ambition combined with a drive to increase exports and grow the economy, is a key theme in the industry’s Roadmap 2035, which sets out a blueprint to deliver a net-zero oil and gas basin.

Matt Abraham, OGUK’s supply chain director, said:

“Share Fair is one of OGUK’s flagship events that focuses on promoting early engagement between suppliers and potential clients. This one-day event is an invaluable opportunity for suppliers to bring innovation, new solutions and fresh ideas to the attention of operator and major contractor companies planning contracts for future projects.”

Four different aspects of business development activities will be on offer at Share Fair. These include the highly popular one-to-one business meetings booked in advance with key decision-makers; major purchaser companies’ presentations of project overviews and anticipated contract opportunities and exhibition space where informal discussions with the wider supply chain community can take place.

Major purchaser companies who’ve already signed up to share their forward plans include BP, Chrysaor, CNOOC International, Dana Petroleum, Neptune Energy, Repsol Sinopec Resources UK Limited, Spirit Energy and TOTAL E&P UK Limited.

This year also sees the launch of a new format enabling suppliers to pitch new ideas focused on addressing key challenges in the sector. These sessions will be offered to OGUK members only and submissions which will be requested in advance of the event

Efforts by the sector to support decarbonisation, improve business competitiveness and develop skills for the future will be explored at OGUK’s annual industry conference in Aberdeen on Wednesday 3 June.

Nearly 500 delegates are expected to attend the conference, titled “Getting to Net Zero – Roadmap 2035” and will consider the progress being made as well as the challenges that are out there if industry is to deliver on its commitment to Roadmap 2035 that it published last year..

Coming six months ahead of the COP 26 conference to be held in Glasgow this year, the flagship industry gathering will consider the continued importance of the UK’s oil and gas industry as the UK and Scotland gears up to meet its climate ambitions.

Focusing on the sixty actions outlined in the five key themes of the sector’s Roadmap 2035: a blueprint tonet zero, delegates will hear from leading industry speakers on:

  • Deepening supply chain excellence
  • Strengthening industry competitiveness
  • Delivering a net zero basin
  • Driving technology and innovation
  • Developing skills, behaviours and culture

Launching the 2020 conference today, OGUK Chief Executive Deirdre Michie said:

“With COP26 on the horizon, our 2020 conference is set to be an important milestone for the sector as we look to champion, challenge and consider our efforts in the transition to a low carbon future.

“The conference programme and exhibition will showcase how we are truly an industry in action to develop solutions, providing the energy the UK needs within the context of ever reducing emissions. The conference will provide a key platform to demonstrate how the challenge is being embraced as an opportunity by companies across the UK.

“This is a valuable event for anyone interested in the UK’s offshore oil and gas industry to understand the changing business landscape and the opportunities it could bring to businesses, jobs, people and economies.”

Ends

The need for improved digitalisation across North Sea operations and the critical role of data in delivering Roadmap 2035, the UK oil and gas industry’s blueprint for net zero, will come under the spotlight at OGUK’s Data and Digital Day on Tuesday 25 February 2020 at The Chester Hotel, Aberdeen.

The inaugural event, chaired by Dr Daniel Brown, Executive Director of Common Data Access (CDA), a wholly owned subsidiary of OGUK, boasts a packed agenda with guest speakers lined up to outline the fundamental role of data and digital in enabling a competitive industry that realises its full potential within the energy transition.

Dr Brown said:

“I am delighted to host OGUK’s first data and digital day. Our impressive line-up of expert speakers will talk delegates through the digital journey of the North Sea as well as discuss the current digital themes in the sector, from data from drones to subsurface data science.

“We will also take a closer look at the role digital can play in improving the cost effectiveness of brown-field developments, with the ultimate aim of deferring decommissioning, and optimising economic recovery of the UK’s oil and gas reserves. With presentations touching on the full E&P lifecycle, we aim to highlight how digital capabilities are core to a competitive UK industry, that will continue to meet UK energy needs while earning our place in the low carbon economy.

“I hope those attending will gain a new appreciation of the range of opportunities that digitalisation can offer businesses and the industry more broadly as we look to deliver Roadmap 2035: our blueprint for net zero.”

Speakers include:

• Maja Kildedal, Head of Innovation and Improvements, Equinor UK
• David Lecore, Senior Compliance Manager, OGA
• Chris Frost, Data Analytics Lead, DataCo Global
• Adrien Bisset, Regional Manager Europe, Belmont Technology Inc
• Stuart Beatty, Managing Director, Kestrel Group
• Steve Aiken, Founder, Intelligent Plant
• Esther Diederen, Digital Transformation Lead, Spirit Energy

-Ends –

The leading representative body for the UK’s offshore oil and gas industry today outlined the details of its response to UK and Scottish Government net zero commitments in a keynote speech delivered by OGUK Chief Executive Deirdre Michie OBE.

Speaking to an audience of politicians, policymakers and campaign groups in Edinburgh, Deirdre Michie said:

Good afternoon everyone and thank you for coming today.

As we all know, our country and much of the world is currently engaged in an increasingly polarised debate about climate change,

It’s passionate, important and yes – urgent.

I’ve come to you today to say that the UK’s offshore oil and gas industry is not shying away from the climate conversation but embracing it,

More than this, I want to put forward our specific proposals for the transition to the lower carbon energy future we all want to see,

It was after all Abraham Lincoln who said the best way to predict the future is to create it,

So, I’m pleased you have all been able to join us and look forward to your thoughts and reflections,

Many of you will know that OGUK’s role is to inform, engage and champion the 400 plus members operating in the UK Continental Shelf – often referred to as the North Sea,

And while this term might be convenient it is actually incorrect as it ignores the East Irish Sea and the vast frontier region in the Atlantic Ocean west of Shetland,

It is a neat – if rather dull – illustration of the need for this technical and complex but critical industry to better inform the debate with facts and tangible examples,

Facts need to be the foundation of our understanding,

Because that is what will enable us to find solutions.

And before I go on, there should be no doubt: this industry isn’t talking about what is and isn’t climate change anymore.

The facts are that the climate is changing, and we must all change if we are to protect our planet for future generations,

It will require constructive, collective and coordinated action to decarbonise a largely fossil fuel-based society which has, in relatively few years, helped to dramatically improve the living standards, health outcomes and quality of life that many of us so freely enjoy today,

But we should also be clear that the need for change also comes at a time when global energy demand is forecast to grow by up to 30 percent by 2050.

And while all industries, businesses and people need to think about what they can each do,

Our industry needs to be generous in deploying our skills, infrastructure and expertise to help find those solutions.

And we are already stepping up to the challenge.

We are an industry capable of doing big things in remarkable ways,

A capability we can – and want to – apply to the climate change challenge.

Here in Scotland, and across the UK, this industry has and continues to sustain hundreds of thousands of jobs, currently over 270,000 as per our workforce report last year.

That’s about one in every 125 employed people in the UK, or 1 in 25 in Scotland.

We’ve contributed over £350bn in production taxes alone, and more from corporation tax and Pay As You Earn as well as billions of pounds in terms of capital spend and running costs invested over the years.

Importantly, this indigenous industry has supported an affordable and secure domestic supply of oil and gas, which remains fundamental to so many of the products and fuel that we need for our everyday lives.

While we continue to emerge from one of the toughest downturns in our history and are by no means out of the woods yet, with real pressures remaining on the supply chain, it is through this incredibly challenging time that we have demonstrated our ability to transform and adapt, delivering a reputation for efficiency and competitiveness,

Operating cost reductions are being sustained and expected to remain around $15-16 per barrel this year.

And we continue to deliver safely and efficiently the day job of exploring, developing, producing and decommissioning.

We are also in action in terms of responding to the challenges of climate change,

You only have to go to Orkney, Glasgow and here in Edinburgh and visit any of our members working in your community to know that this is a challenge we are taking seriously.

And I would encourage you to do this, and to see it first-hand, some of the great work that is going on.

Stepping up to reduce carbon emissions to net zero by 2050 in the UK and by 2045 in Scotland is also an opportunity for the UK’s oil and gas industry to shine in a competitive global market.

Sustaining jobs, contributing to public services through taxation, providing secure energy supply and diversifying as we help to find solutions.

The Scottish Government has made clear that it supports a sustainable, fair and inclusive transition,

And I know the UK Government is taking a similar approach,

These are important principles which say a lot about the kind of transition Scotland wants to see.

First – it means planning for a transition which ensures people in Scotland continue to enjoy affordable and low carbon energy,

Second – this transition will deliver opportunities for the people working in the industry today as it evolves in the coming decades,

Third – the transition must deliver sustainable and enduring change,

While I welcome calls to “do more” and at pace,

We now need to move the debate on from talking about the need to act, to demonstrating what we are doing to act,

We have a plan – Roadmap 2035 – which offers a blueprint for net zero,

It is one of the first industrial responses to the UK and Scottish governments net zero commitments.

It aims to enable a safe, sustainable and competitive oil and gas industry supporting the UK’s energy needs and its transition to a net zero future,

These aspects are not mutually exclusive but inextricably linked.

Developed through over 5000 engagements with a range of stakeholders, Roadmap 2035 has been welcomed by both governments and energy ministers.

It sets out 60 actions across five key areas,

And today I can confirm that OGUK has convened an industry-wide group of company leaders and young professionals to coordinate efforts, identify gaps and drive action in pursuit of what is a truly challenging task but also a transformational opportunity,

So, to the first group of actions – our support for net zero

We will do this by reducing emissions from the operational production of oil and gas,

And through supporting other heavy emitting sectors to achieve net zero through our skills, technologies and infrastructure,

But what does this mean?

Firstly – in terms of our own production emissions, we will be a net zero oil and gas basin by 2050,

Reducing emissions from 14 million tonnes – currently three percent of the UK’s total greenhouse gas emissions – to 0.5mt – in line with the Climate Change Committee outlook,

It will require significant investment, new technology and close working with the renewables sector in Scotland and across the UK

I’m pleased to announce that we are developing targets for emissions reduction, and we will soon publish a detailed action plan in support of this — this is an industry in action.

In December last year the OGA – our industry regulator – published the interim findings of the first phase of its Energy Integration Project,

Working with BEIS, the Crown Estate and Ofgem, this important report offers a good starting point as to how we begin to bring key carbon reduction concepts to life,

Reducing emissions on oil and gas installations by using low carbon electricity including directly from offshore wind farms to replace offshore power generation from gas and diesel,

It takes me on to our second net zero commitment.

We will support the development of CCUS and other low carbon tech at scale,

The Climate Change Committee estimates that up to 175m tonnes of C02 each year will need to be captured and stored in the UK by 2050.

And that’s even if the UK delivers against every cross-sectoral recommendation in their initial report,

Indeed – CCUS is required in all decarbonisation scenarios.

Globally, some 10,000 projects will be needed,

An industry forecast to be worth around £100bn each year by 2050,

This is not only a necessary technology to meet our climate goals, it is therefore also a potential opportunity for Scotland and a diversifying energy industry.

This sector stands ready to play its part.

Assisting in the development of the commercial business models that are needed to help deliver CCUS clusters, hydrogen opportunities and the decarbonisation of offshore platforms at scale,

We are putting forward our skills, capabilities, assets and knowledge,

And working with governments and regulators to clarify policies and regulations on CCUS and hydrogen,

including improving the understanding of what is required to repurpose existing oil and gas assets for use in the low carbon world,

The CCS charter signed between the Scottish Government and industry demonstrates our commitment,

We are looking to work with governments and regulators to progress the five CCUS projects across the UK which now need to move at pace into the next phase,

One of which is the North East’s £224m Acorn project.

Expected now to be operational by 2024,

And with the potential to store 16.2m tonnes of carbon per year,

It would be good progress, but still only a fraction of what is required.

And on hydrogen,

Much more will have to be done to explore the full opportunity of this potentially disruptive player in the clean energy mix,

Reports by Swansea and Keel Universities found up to 30 percent of the UK’s gas supply can be replaced with hydrogen without needing to modify people’s appliances,

With currently 75 percent of the UK’s heating demand in buildings being met by natural gas

It shows the scale of the opportunity,

And the analysis from the International Energy Agency showing that the cost of producing hydrogen from renewable electricity could fall 30% by 2030 as a result of declining costs of renewables and the scaling up of hydrogen production helps us to begin to see what a truly transitional and transformational approach could look like,

Blue hydrogen derived from gas will need to compete alongside green hydrogen made from renewables – but both will be needed if we are to match the energy needs I referenced earlier on,

So, combining with Carbon Capture and Storage, hydrogen from natural gas could cut emissions, alongside efforts to reduce the cost of producing hydrogen from clean energy,

You can see why it matters that we do this right,

The developing hydrogen economy could also bring far-reaching benefits across Scotland,

For example, in Orkney, where a consortium led by the OGTC alongside universities and oil companies are looking to create a test centre at Flotta oil terminal for trialling these different types of technologies for use on offshore platforms,

So today we urge the UK and Scottish governments to continue to think about the full system changes from the production of energy to its use in our homes and businesses,

To recognise that this industry can help provide solutions which unlock the inclusive, fair and sustainable transition we all want to see,

And we call for a comprehensive UK energy strategy from the UK Government, to be reflected in their imminent white paper.

The Committee on Climate Change report also recognised that by 2050, oil and gas will continue to form part of a diverse energy mix,

Albeit at lower levels, roughly about a third of what it is today,

That’s because the CCC forecast that oil and gas will still be needed by those sectors especially difficult to decarbonise,

Sectors such as heavy industry and aviation, and of course its continued use in many industrial and chemical processes,

Whether its pharmaceuticals, or in producing the composite materials which, used sustainably, will continue to be critical in our daily lives,

So, I also consider it’s important we deliver as much of this demand from domestic resources – a point I’ll come back to shortly.

Meeting net zero is only the first of five themes outlined in what you can see truly is a comprehensive roadmap,

With our 2nd theme of driving technology and innovation, we will spur a net zero technology revolution, adding some £10bn in economic value to the UK through technology and innovation,

Through work being championed by the OGTC, that has already launched a net zero solutions centre in support of this ambition,

And our 3rd theme, of developing people and skills,

By 2035 we will support some 130,000 jobs,

Compared to just over 150,000 direct and indirect jobs we support today,

This will actually require us to attract 40,000 new people, a quarter of whom will be in new roles, many of which don’t exist yet, to cater for technology developments as well as the expected natural attrition from the industry through retirement,

This is being driven by the industry skills body OPITO and their innovative work through the Energy Skills Alliance to support the development of a multi-skilled energy workforce that is flexible, dynamic and technologically enabled,

In growing the economy and exports, our 4th theme,

We’re looking to double exports from a diversifying energy sector to £20bn each year,

Working with governments to deepen our sector’s understanding of international markets and ensure our experience is utilised globally and in different sectors,

And those of you who joined the excellent cross-party group held with Scottish Renewables last week will have heard how diversification in the supply chain can open the door to more international opportunities,

The final theme is on meeting the UK’s need for energy and industrial products.

I spoke earlier about the requirement to meet as much of the UK’s energy needs from domestic resources, as per the CCC report and its focus on energy sovereignty,

And their forecast that during the transition and beyond, there remains a need for oil and gas.

Let’s be clear here – the premature shut down of this industry in the UK would do nothing to impact consumption,

Those needs would instead be met from increasing the amount of oil and gas imported from across the world,

But it would also mean we realise none of the benefits this indigenous industry brings in jobs, taxation and security of supply,

Nor would it enable control over environmental governance and standards.

So, what might seem an easy and quick fix, is instead simply shifting the problem to other countries.

Which is sometimes referred to as carbon offshoring,

This isn’t fair, inclusive or sustainable, it’s actually irresponsible.

It’s an example of a transition which helps get to the same destination, but at an unnecessary cost,

Leading to unintended consequences because the changes aren’t inclusive or supported by an effective, integrated and affordable energy system,

This is not the path we need to go down, and it’s why today we are coming to you with our plan,

Building on their contribution to this great industry, we can take Aberdeen, Glasgow, Shetland, Edinburgh and everywhere in between on the journey,

We can equip people with the skills and remove barriers so that they can enjoy rewarding energy careers for decades to come,

Meaning that by 2045 in Scotland –  we will have delivered a truly fair, inclusive and sustainable transition to a low carbon future where our transformed and thriving industry is part of the solution,

It’s an exciting proposition.

One which will underpin our calls for a transformational sector deal which we will look to announce later this year,

Which is why today my ask of you all is to consider the Roadmap,

To hear out the facts and then make your call as to the role of this industry going forward.

As we look to the future, I have no doubt that it will be our shared understanding, informed by facts,

And an inclusive approach, that will enable our delivery of the net zero challenge,

Yes, we need vigorous debate, but the so-called cancel culture Obama spoke about,

The culture which says the people in our industry don’t have the right to a voice,

Undermines the fundamental principles of the inclusive, fair and sustainable transition we all want to see.

We are here and we want to help,

And we want to be a positive force in this transition,

As Jonathan Foer notes in his excellent book ‘We are the Weather’,

Collective action is the best way to save our home and way of life.

So, let’s work together, because we can.

Thank you.


The Chairman of the Oil and Gas Authority has challenged the UK oil and gas sector to respond to the energy transition. Commenting, Deirdre Michie, Chief Executive OGUK said:

“We are an industry in action. Roadmap 2035: a blueprint for Net Zero is one of the first major industrial responses to government plans to reduce or offset carbon emissions to net zero by 2050 in the UK and 2045 in Scotland.

“We will continue to work closely with all industry regulators including the OGA to deliver a safe, sustainable and competitive industry that realises its full potential in the transition to the low carbon future we all want to see.”

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Commenting on protests outside oil and gas offices in Aberdeen today, OGUK Stakeholder & Communications Director Gareth Wynn said:

“Climate change will be solved by practical actions not conspiracy theories and stunts. It’s disappointing that this group is choosing to disrupt the normal working day of people in this industry, causing alarm rather than engage in meaningful discussion with key decision makers.

“This industry, through our Roadmap 2035, is committed to delivering an inclusive, fair and sustainable transition to a low carbon and diverse energy mix. Again, we welcome those who are willing to take part in meaningful and solutions-focused discussions. Our industry is packed full of people with the engineering and environmental knowledge and skills to play a key part in reducing emissions and we are already taking action.”

The leading representative body for the UK offshore oil and gas industry has kicked off the new year with ambitious plans to champion the sector as part of a diverse energy mix.

Two new directors will join OGUK’s leadership team under the continued direction of Chief Executive Officer Deirdre Michie OBE.

Katy Heidenreich

Katy Heidenreich

Trevor Stapleton is announced as OGUK’s new Health, Safety and Environment (HSE) director while Katy Heidenreich is confirmed as Operations director, both commencing their new roles on 3 February 2020.

The two new directors join a reshaped leadership team to support industry in its delivery of Roadmap 2035: a blueprint for net zero.

Matt Abraham will take on a more focused brief as Supply Chain and Exports director, directing his extensive experience in contractor companies to help grow exports and support a resilient, competitive and diverse supply chain. Meanwhile. Mike Tholen will become OGUK’s Sustainability director, using his own deep experience in the industry to help drive  action to deliver a net zero basin,  from the operational production of oil and gas and assisting the UK in reducing its total GHG emissions through to adoption of technologies including Carbon Capture Usage and Storage.

Graham Elgie continues as OGUK’s Finance and Corporate Services director and Gareth Wynn as OGUK’s Stakeholder and Communications director.

Commenting, OGUK Chief Executive Deirdre Michie said:

“2020 is synonymous with perfect vision and we are wasting no time in getting to work delivering industry’s ambitious plans for the future outlined in Roadmap 2035: a blueprint for net zero.

“I’m delighted to announce these changes to our leadership team which will enable us to even better support companies and to help drive  action as we work to inform, engage and advocate the importance of this industry as part of a diverse energy mix.

Trevor Stapleton

Trevor Stapleton

“We have a challenging but exciting year ahead of us as we work to support all our members that operate in or provide services to the UK offshore energy industry. With continued volatility in oil markets our focus remains on enabling a safe and competitive industry that delivers to its full potential within the energy transition, ensuring the North Sea remains an internationally attractive place to do business.

“Katy and Trevor each bring an incredible amount of experience and are highly regarded by their peers. Their strategic insight will be critical as we gear up to deliver our blueprint for net zero, demonstrating the practical steps companies are taking to reduce emissions, meet UK energy needs and develop our people and skills for the future.

“This industry has a positive role to play in providing solutions to the UK’s net zero challenge and we are already in action with our Roadmap. Leading from the front, OGUK is proud to champion our dynamic and diverse industry and we look forward to continuing to work with all of our stakeholders in the year ahead.”

Commenting on news that protestors have boarded a drilling rig in Dundee harbour, OGUK Chief Executive Deirdre Michie said:

“This is a dangerous and short-sighted stunt which does absolutely nothing to help provide the solutions which will be required to meaningfully deliver net zero emissions by 2045 in Scotland.

“Worse than this, we know that the premature shutdown of the North Sea would only increase reliance on oil and gas imported from across the world where we have no control over emissions and with none of the substantial benefits our indigenous industry brings with its thousands of skilled jobs, the funding of public services and energy security.

“This stunt puts both the activists and offshore workforce at risk and our industry – with its focus on safe operations – will not condone these actions.

“If Extinction Rebellion is serious about net zero then it needs to become serious about what will be required and recognise the critical contribution our industry could make if it realises its full potential to support the transition to a lower carbon and more diverse energy mix.

“Our industry is part of the solution and Roadmap 2035: a blueprint for net zero outlines our plans to reduce emissions from the operational production of oil and gas while supporting other heavy emitting sectors to reduce emissions through low carbon technologies including Carbon Capture Usage and Storage and hydrogen. This is an industry in action, and we are committed to working with anyone to find solutions and deliver the low carbon future we all want to see.”

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OGUK launches survey to understand issues facing supply chain

The leading representative body for the UK offshore oil and gas industry has launched a survey in a bid to help find solutions to the problems faced by the supply chain as it deals with the impact of the coronavirus pandemic and low oil and gas prices.

A comprehensive set of questions covering offshore activity levels, the financial position of companies, employment levels and plans, investment and feedback on steps that can be taken by industry and government to support the sector was issued to the hundreds of OGUK member companies in the industry’s supply chain who range from larger contractors to small and medium sized enterprises.

The results of the survey will inform the details of a COVID 19 Sectoral Resilience Package being put together by industry to propose to governments in the coming weeks. It will build upon the already extensive support offered by governments to companies and self-employed workers and is intended to directly address sector-specific issues. This includes what has come to be known as the stranded middle: companies who currently would not be eligible to apply for the Coronavirus Business Interruption Loan (CBIL) Scheme or the COVID-19 Corporate Financing Facility (CCFF).

On Wednesday, BEIS Energy Minister Kwasi Kwarteng joined OGUK’s contractor council to hear first-hand the challenges facing the sector.

Last night in line with requests from OGUK, the UK government announced it has introduced a  Coronavirus Large Business Interruption Loan Scheme (CLBILS) which will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £500 million.

OGUK today said it hopes to announce further details on its proposals in the coming weeks.

Commenting, OGUK Supply Chain Director Matt Abraham said:

“Our supply chain is facing pressures in the extreme. The operational impact of the coronavirus pandemic, low oil and gas demand and low prices mean an uncertain future for many. This triple whammy of concern comes only as many were just starting to emerge from the impact of the previous prolonged downturn. Last night’s announcement from government is welcome and confirms it is listening and responding to feedback, however there are still specific issues with regards to support for the oil and gas sector which OGUK is working to address with both UK and Scottish governments.

“We’re hoping this survey will give us a clear idea of where governments and regulators can offer specific help that will really make a difference and we’re urging all of our members in the supply chain to take part. In the coming days and weeks, we’ll put forward to government our proposals for a COVID19 Sectoral Resilience Package and look forward to continuing what has been a positive and constructive dialogue. We’re grateful to the CBI particularly for their support in developing our proposals – remaining joined up across industries is critical as we look to protect jobs and businesses.”

Information for the industry about COVID-19 is available at www.oilandgasuk.co.uk/covid-19

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Industry films address offshore travel concerns

OGUK, the leading representative body for the UK’s offshore oil and gas industry and Step Change in Safety, the industry’s recognised safety organisation, have co-produced a series of films to address the concerns of thousands of workers travelling offshore during the coronavirus pandemic.

There are currently two films available to view with the first co-presented by OGUK’s aviation advisor, Graham Wildgoose and Matt Rhodes, Bristow Helicopters UK and member of the Step Change in Safety Leadership Team. Together they address aspects of helicopter travel including operational procedures, arrival and departure protocols, and the transfer of passengers.

The second film features OGUK’s medical advisor, Dr Graham Furnace providing answers to questions regarding the workforce’s concerns around current coronavirus-related medical and health issues. Topics he covers include temperature checking, measures to take when temperatures are high and self-isolation offshore.
The films also feature contributions from OGUK Chief Executive Deirdre Michie and Step Change in Safety Executive Director Steve Rae, who in a joint statement published today, said:

“Our industry has health and safety at its core and in adjusting to the impact of the coronavirus pandemic, we’ve all had to make radical changes to the way we live and work. For many the new normal is working from home, but for thousands of people in our industry going to work means travelling by helicopter offshore to help meet our daily energy needs.
The means by which we prepare for, and undertake, these journeys has had to change. These essential changes are by design intended to provide additional barriers to protect against the spread of this virus offshore, allowing us to continue to provide continuity of energy supply to support the vital work that all key workers are undertaking to protect the health and wellbeing of our nation. With that in mind it is our duty to ensure that our workforces concerns are responded to in a timely and factual manner.

“These films are part of a series to support our workforce with comprehensive information about travelling offshore when they most need it.”

Two films are now available to view on both the Step Change in Safety and the OGUK websites here.
www.stepchangeinsafety.net/covid-19
www.oilandgasuk.co.uk/covid-19

April 1 marks the 11th anniversary of the helicopter flight 85N accident in which 16 people lost their lives . Every year since, family members, friends and colleagues of those lost have gathered at the memorial in Johnston Gardens Aberdeen to remember those lost. Due to the coronavirus, people are unable to physically come together so the industry’s chaplain, Reverend Gordon Craig has provided a short, recorded act of remembrance online which can be accessed here https://youtu.be/e6ZXS0hXAnE

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Industry offers support to critical workers keeping UK running

OGUK, the leading representative body for the UK’s offshore oil and gas industry has teamed up with Step Change in Safety, the industry’s recognised safety organisation to offer support to the tens of thousands of workers keeping the UK running with secure and affordable energy during the coronavirus pandemic.

A new dedicated online hubs with guidance, videos and FAQs has been launched to provide everyone involved in the industry, and their families, with a “one stop shop” to address concerns on the prevention and protection against coronavirus in around 150 manned installations across the UK Continental Shelf (UKCS) and the substantial onshore workforce. Both organisations are working jointly to provide the most accurate information about topics and services such as offshore helicopter travel, health screening and training re-certification. It is available on Step Change in Safety and OGUK websites

In a joint statement published today, OGUK Chief Executive Deirdre Michie and Step Change in Safety Executive Director Steve Rae said:

“Our industry workforce plays a critical role in providing the energy and products the UK needs to power hospitals and make essential trips. Our message to our people is clear: you are doing an essential job in keeping us safe and warm, and we need to work together to keep you safe at work.

“Working tirelessly with governments, regulators and our industry we have secured clear arrangements on the safe removal of suspected cases from offshore, on establishing our workforce as key workers so they can continue to send their children to school if they have to and to continue to travel to work and on temperature testing as standard at all heliports.

“We continue to work with governments to make the case for testing of offshore personnel, and now, more than ever before, we will be supporting our workforce to feel and be safe as they carry out their essential work. It’s why today we are combining strengths in launching a dedicated online hub with guidance, videos and FAQs. We will continue to encourage the participation of the unions, the regulator, and our members to work together in circumstances that are completely unprecedented.”

OGUK welcomes Government action to support workers and companies in face of triple impact on industry

The UK offshore oil and gas industry which plays a vital role in the security of energy supply for the nation has been severely hit by the triple impact of COVID-19, the oil price crash and the lowest gas prices in the last ten years.

With many businesses facing a fight for survival, industry body OGUK, that represents over 400 companies has welcomed the UK Government’s announcement of help for both workers and companies.

Deirdre Michie, Chief Executive of OGUK said:

“Many of the companies in our industry, especially in the supply chain, are still financially fragile after the previous oil price crash, so the triple whammy we now face is particularly dangerous. In that context the strong response from the UK Government and their clear determination to support both workers and companies is very welcome. It is now crucial to ensure companies can easily and rapidly access this money as for many businesses and individuals cash flow is now vital.”

Companies in the UK offshore oil and gas industry contributes around 50% of UK gas which is used for a large proportion of our electricity production and which heats the vast majority of our homes. They also produce a major proportion of the oil that fuels our cars and is used in the manufacture of a huge proportion of the items we use in our daily lives from contact lenses and toothbrushes to the lightweight cases on our mobile phones. Companies in the UK industry are also backing the UK drive to net zero emissions and have also been working on technology to help us get there.

Industry welcomes inclusion on key workers list

OGUK has today welcomed the UK Government’s announcement that oil and gas workers are included on a list of key workers whose children will be prioritised for education provision.

Commenting, OGUK Chief Executive Deirdre Michie said:

“As an industry we are committed to doing everything possible we can to help the country and our businesses and our people through this devastating crisis and we appreciate the announcement today on access to education. We’re working closely with government to resolve any challenges we face to maintaining safe operations for our people and ultimately ensuring we can continue to provide the UK with secure and affordable energy.”

Find the latest updates on here

First Efficiency Webinar of 2020 promotes effective project management

Effective project management is the topic under scrutiny at the first Efficiency event of 2020, which OGUK and the Engineering Construction Industry Training Board (ECITB) will co-host via a webinar on March 24.

Anyone keen to improve project management performance can dial in to a breakfast-time web-based seminar focusing on the ECITB’s recently updated Project Collaboration Toolkit, will highlight the benefits and efficiencies that collaboration can deliver.

Emily Taylor, OGUK’s Continuous Improvement Manager, said:
“The combination of the global economic impact of the continued spread of the coronavirus, the most dramatic fall in oil price in almost 30 years and a halving of gas prices is placing extraordinary pressures on our industry. We’re focusing on everything we can do to share knowledge that helps protect our industry, enabling its sustainability and resilience in extremely difficult conditions while underpinning collective efforts to deliver a net-zero oil and gas basin.
Evaluation of activities on the UK Continental Shelf between 2011-2016 demonstrated how inefficient project management contributed to costly budget overruns of up to 35% and delays in delivery. The Efficiency Task Force’s role in seeking out, promoting and providing access to efficient practice across the industry with tools like OGUK’s Robust Project Delivery Guidelines and ECITB’s Collaboration Toolkit is making a difference, with project delivery performance improving in 2018 so this webinar is a great opportunity learn more.”

Chris Claydon, Chief Executive of the ECITB, said:
“The Project Collaboration Toolkit has demonstrated its value to the UK oil and gas industry since its launch because by sharing skills and expertise across projects we see improved efficiency and productivity.
“It’s already been used successfully on several projects in the upstream and downstream sector, such as Shell’s Brent Bravo, where smaller project teams worked collaboratively to deliver the project on time and at reduced cost. “It is also used as a resource by Robert Gordon University to teach the project managers of tomorrow about the process of collaborative working.
“There’s no doubt that supply chain collaboration is critical to transforming the business performance of the UKCS and the toolkit is a valuable resource for project managers.”

The webinar ETF is presenting in collaboration with ECITB to showcase efficiency opportunities in project management, will start at 8.30 am and will feature the following speakers:
• Phil Simon, ETF chairman
• Chris Claydon, CEO ECITB
• Neil Rogerson, Engineering Director, Epro-Subsea
• Dan Mcateer, Head of Project Management, Worley
The presentations will close at 9.30am following a Q&A session

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Notes to Editors:

1. Further information on the event can be found here

in collaboration with ECITB to showcase efficiency opportunities in project management, will start at 8.30 am and will feature the following speakers:

  • Phil Simon, ETF chairman
  • Chris Claydon, CEO ECITB
  • Neil Rogerson, Engineering Director, Epro-Subsea
  • Dan Mcateer, Head of Project Management, Worley

The presentations will close at 9.30am following a Q&A session

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OGUK warns industry position is paper thin in face of oil price and coronavirus pressures

The combination of the global economic impact of the continued spread of the coronavirus, the most dramatic fall in oil price in almost 30 years and a halving of gas prices is driving an increasingly fragile outlook for the UK’s offshore oil and gas sector. Severe pressures are already building across the sector’s supply chain, with the pressures expected to significantly undermine the industry’s businesses, jobs and contribution to the economy.

The stark warning was made today by the leading representative body for the sector OGUK, in the first in a series of Business Outlook reports which will shine a light on the issues facing the sector in a challenging and dynamic business environment.

The Business Outlook: Markets and Investment report shows OGUK now expects drilling levels to fall back to the lows experienced in 2016, down more than a third on previous forecasts. The report also warns of a possible 20-30 percent decrease in capital investment for 2020 as well as the potential that the operators in the sector will experience negative cash flow this year.

While the industry was only beginning to emerge from one of the most prolonged and severe downturns in its’ history, OGUK said the supply chain had remained under significant pressure, with tight margins and relatively low activity levels.

OGUK today called for government support to ensure the sector can continue to provide security of supply in the face of these extraordinary difficulties. The body also said it was working with industry, regulators and government to understand how it can protect supply chain companies, and jobs.

OGUK Chief Executive Deirdre Michie said:

“Businesses and industries across the UK are facing extraordinary pressures but coming so soon after one of the worst downturns in our history, this report shows that this sector is now in a paper-thin position.

“The offshore oil and gas sector is part of the UK’s critical infrastructure, providing the secure and affordable energy the country needs and is  a key contributor to the economy in terms of supporting hundreds of thousands of skilled jobs, businesses and our wider economic contribution.

“Action is needed now to ensure the sector doesn’t lose the skills, experience and infrastructure it needs to meet the UK’s energy needs of today as well as help deliver its net zero ambitions in future.  We appreciate the Chancellors recent statement and OGUK is requesting urgent meetings with ministers to consider a COVID-19 Sectoral Resilience Package which would help to give some reassurance to the regions, businesses and jobs this industry supports.

“We’re already working with our members to understand the challenges businesses are facing in these unique and extremely worrying times.”

OGUK Market Intelligence Manager Ross Dornan said of the report:

“The first week of March saw the most dramatic fall in oil price in almost 30 years and it remains uncertain as to how the market is going to evolve in the coming months as the coronavirus impact increases each day.

“Alongside this, the gas price has more than halved in the last 12 months, and we face a situation where E&P production revenues are set to be almost 50 percent lower than they were  two years ago despite the same level of output.

“The UKCS has seen significant improvement in its competitiveness, efficiency and productivity in recent years. These improvements will help performance, however in this harsh environment we expect companies to take significant steps to preserve cash flow and ensure business continuity. This will have a very negative impact on the supply chain, which has not yet seen much recovery from the previous downturn and doesn’t have the capacity to absorb much more pain.

“Companies are increasingly diversifying into other energy sectors and across industries more generally, but many cannot diversify or are too early in their journey to provide adequate protection/buffer. At this time innovative thinking, partnerships and meaningful collaboration will be required to help as many as possible to weather the storm.”

COVID-19 Update

OGUK Health, Safety and Environment Director Trevor Stapleton said:

“OGUK continues to work with our members to share official advice on coronavirus (COVID-19) from the relevant bodies to ensure the health of the people in our industry.

“This sector is experienced in managing risks associated with complex safety and health matters, with robust processes and arrangements in place to ensure effective prevention measures and response for both onshore and offshore operations. The challenges of managing health in a remote environment are understood and industry has long-established medical facilities and personnel onboard, supported by a topsides doctor onshore.

“In addition to following official advice and in support of members, OGUK has over the past weeks facilitated industry discussion with the appropriate agencies on how best to understand, manage and respond to the challenges this novel virus poses, ensuring information is shared. This includes our regulator, the HSE, and the relevant public health bodies.

“As with confirmed cases onshore, in the event of a confirmed case offshore, the affected operator will work with the relevant agencies to risk assess the specifics of the situation and ascertain the appropriate response. OGUK continues to work with all our members and stakeholders to share information.”

General Update:

Following the WHO confirmation yesterday that COVID-19 is a pandemic, the UK government is expected to move into the next stage of response shortly.

This may mean significant changes to the way we work and socialise, and most importantly the way we individually act to minimise the spread of infection.

All members are encouraged to stay up to date with and continue to follow government advice on responding to COVID-19 and to communicate with their workforce and supply chain on how that advice is being implemented in their operations.

There is wide-ranging advice on many topics available from Public Health England and Health Protection Scotland on how best to minimise transmission of the virus within the workplace. This advice is revised and new guidance produced continuously as more is learned about the virus.

Regularly updated guidance and resources can be found on the following web pages:

https://www.gov.uk/government/collections/coronavirus-covid-19-list-of-guidance

https://www.hps.scot.nhs.uk/a-to-z-of-topics/covid-19/

UK agencies are co-ordinating to ensure that advice is consistent across the country.

OGUK Pandemic Steering Group

OGUK has convened an industry Pandemic Steering Group, which is made up from representatives from across the sector and is tasked with identifying and addressing the particular challenges faced by those working to maintain offshore operations at industry-level and ensuring communication with relevant stakeholders and government agencies.  The group is tasked with focusing only on those issues which require cross-industry action and co-ordination.

The PSG is meeting regularly and updates are being shared with our technical groups. It is not tasked with providing updates and advice on operational response. Member companies are implementing their individual pandemic response and business continuity plans to ensure that industry can respond effectively.

OGUK will share industry-specific advice as it becomes available and enable sharing of lessons learned as members gain experience in dealing with the specifics of this pandemic.

Industry Travel Policy for Offshore Installations

Given the challenges of managing any confirmed case of COVID-19 on an offshore installation, industry policy is to have restrictions on workers travelling to offshore installations. Industry policy is that personnel will not be permitted to travel offshore if:

  • They have travelled from or transited through affected countries in the last 14 days, or since dates defined on the UK government’s list of affected areas.

This includes both Category 1 and Category 2 areas (up to date lists can be found here).

  • If they have been in close contact with a confirmed case of COVID-19 in the last 14 days.
  • If they have experienced symptoms of cough, fever and shortness of breath.

Oil and gas industry travel restrictions apply to fixed and mobile offshore installations. It is not intended to apply to vessels involved in the offshore oil and gas industry.

OGUK Business Outlook Breakfasts – update

In light of the developing spread of COVID-19 (Coronavirus) in the UK and elsewhere, the team at OGUK has been evaluating the Business Outlook Report launch events planned to take place on Wednesday 18 March and have now taken the decision to cancel the breakfast briefings in both Aberdeen and London.

OGUK prides itself in providing excellent market intelligence valued by our members, the wider industry and our stakeholders. Given the rapidly changing commodity price environment in which we now find ourselves, and the potential implications across the industry, we’re also taking the opportunity to re-evaluate the content of the Business Outlook report and over the coming weeks publish a series of smaller reports to best capture what is a dynamic business environment.

We’d like to thank you for your understanding on the constraints that are being placed on events and meetings. We appreciate your plans for the events would have been underway and apologise for any inconvenience caused. The ticket that you have purchased for the breakfast will be refunded.

In replacement of the breakfast events, we are progressing plans to host a webinar with industry panellists and will share details of this with you in due course – we do hope that you will be interested in supporting our virtual event.

We are sorry to have had to take this decision but hope that you can appreciate our reasoning and we look forward to welcoming you to future OGUK events in 2020.

 

Update on OGUK events

OGUK has today (Tuesday, March 3) confirmed it has taken the decision to postpone a number of its events this year in light of the developing spread of coronavirus.

The below events will be postponed, and new dates will be released in due course:

•            Share Fair, March 24th, Aberdeen

•            Doctors’ Training Workshop, April 1st, Aberdeen

•            D&I Conference, April 23rd, Aberdeen

•            Examining Doctors’ Conference, May 7th, London

OGUK said the safety of its members and visiting delegates was of the upmost priority and it will communicate the rescheduled event dates in due course, with a replacement ticket issued to those who had already purchased.

Gareth Wynn, OGUK’s stakeholder and communications director, said: “We are continuing to work closely with our members to circulate official advice on coronavirus (COVID-19) from the relevant agencies and will continue to work across the sector to help ensure the health of people in the oil and gas industry.

“Our more imminent Business Outlook Breakfast Briefing events in both Aberdeen and London are expected to go ahead as planned as they attract primarily local audiences and run for a short duration with more limited contact between delegates, however we will continue to monitor the situation and any advice from the health authorities.  

“We will also be communicating additional guidance to all delegates in advance of these events to help mitigate the potential spread of the virus.”

Just Transition Commission report underlines need for fair, inclusive and sustainable transition

The leading representative body for the UK’s offshore oil and gas sector, OGUK, has highlighted its plan to ensure the sector can help deliver net zero emissions while providing the secure and affordable energy Scotland needs as it transitions to a low carbon future.

It comes in response to an interim report published by the Scottish Government-appointed Just Transition Commission. The commission welcomed the industry’s Roadmap 2035 – one of the first industrial responses to UK and Scottish Government net zero commitments – which sets out over 60 practical actions in five key areas needed to ensure a successful transition.

The report also called for greater engagement with the workforce, steps to ensure reducing emissions does not see high quality jobs leave the country and called for a joined-up approach to ensure all agencies working with stakeholders towards a shared goal.

Responding to the report, OGUK Chief Executive Deirdre Michie said:

“This report shares our industry’s focus on delivering a fair, inclusive and sustainable transition to a low carbon future. These findings confirm the need for continued partnership working with governments, regulators and our people to ensure that we can continue to support the UK’s diverse energy needs, the communities we work in as well as wider society.

“Our blueprint for net zero as outlined in Roadmap 2035 shows a changing industry in action with a credible plan for the future. Delivering the Roadmap means that the sector can contribute to supporting the energy transition as well as providing secure and affordable energy, ensuring hundreds of thousands of jobs and crucially developing the skills and expertise Scotland needs to find solutions to meet net zero ambitions.

“We’re in the early stages of our journey as an industry and a country and this reinforces that we are heading in the right direction. With the continued support of governments and regulators and a shared commitment to Roadmap 2035, we can deliver a successful transition for the people working in our industry and wider society – both now and in future.”

OGUK response to Coronavirus

Commenting on the current concerns regarding coronavirus in the UK, Trevor Stapleton, OGUK’s HSE director, said:

“We’re already working with our members to share official advice on coronavirus (Covid-19) from the relevant bodies and will continue to work across the sector to ensure the health of the people in our industry. This sector is well versed in managing risk on complex safety and health matters, with robust processes and arrangements in place to ensure effective prevention measures and response. In addition to following the advice from health bodies and applying relevant procedures, individual operators will also decide further arrangements relevant to their specific needs, including travel and health advice. OGUK remains in regular contact with the relevant authorities to understand any further industry specific advice.”

Early sight of business opportunities at OGUK’s Springtime Share Fair

 

Supply chain companies keen to be among the first to learn about business opportunities will benefit from advance information on major oil and gas projects by participating in OGUK’s Share Fair in Aberdeen on March 24.

As the leading representative body for the UK’s offshore oil and gas industry, OGUK’s popular business development event supports the growth of a resilient, competitive and diverse supply chain. This ambition combined with a drive to increase exports and grow the economy, is a key theme in the industry’s Roadmap 2035, which sets out a blueprint to deliver a net-zero oil and gas basin.

Matt Abraham, OGUK’s supply chain director, said:

“Share Fair is one of OGUK’s flagship events that focuses on promoting early engagement between suppliers and potential clients. This one-day event is an invaluable opportunity for suppliers to bring innovation, new solutions and fresh ideas to the attention of operator and major contractor companies planning contracts for future projects.”

Four different aspects of business development activities will be on offer at Share Fair. These include the highly popular one-to-one business meetings booked in advance with key decision-makers; major purchaser companies’ presentations of project overviews and anticipated contract opportunities and exhibition space where informal discussions with the wider supply chain community can take place.

Major purchaser companies who’ve already signed up to share their forward plans include BP, Chrysaor, CNOOC International, Dana Petroleum, Neptune Energy, Repsol Sinopec Resources UK Limited, Spirit Energy and TOTAL E&P UK Limited.

This year also sees the launch of a new format enabling suppliers to pitch new ideas focused on addressing key challenges in the sector. These sessions will be offered to OGUK members only and submissions which will be requested in advance of the event

Flagship industry conference to reinforce oil and gas delivery in a net zero context

Efforts by the sector to support decarbonisation, improve business competitiveness and develop skills for the future will be explored at OGUK’s annual industry conference in Aberdeen on Wednesday 3 June.

Nearly 500 delegates are expected to attend the conference, titled “Getting to Net Zero – Roadmap 2035” and will consider the progress being made as well as the challenges that are out there if industry is to deliver on its commitment to Roadmap 2035 that it published last year..

Coming six months ahead of the COP 26 conference to be held in Glasgow this year, the flagship industry gathering will consider the continued importance of the UK’s oil and gas industry as the UK and Scotland gears up to meet its climate ambitions.

Focusing on the sixty actions outlined in the five key themes of the sector’s Roadmap 2035: a blueprint tonet zero, delegates will hear from leading industry speakers on:

  • Deepening supply chain excellence
  • Strengthening industry competitiveness
  • Delivering a net zero basin
  • Driving technology and innovation
  • Developing skills, behaviours and culture

Launching the 2020 conference today, OGUK Chief Executive Deirdre Michie said:

“With COP26 on the horizon, our 2020 conference is set to be an important milestone for the sector as we look to champion, challenge and consider our efforts in the transition to a low carbon future.

“The conference programme and exhibition will showcase how we are truly an industry in action to develop solutions, providing the energy the UK needs within the context of ever reducing emissions. The conference will provide a key platform to demonstrate how the challenge is being embraced as an opportunity by companies across the UK.

“This is a valuable event for anyone interested in the UK’s offshore oil and gas industry to understand the changing business landscape and the opportunities it could bring to businesses, jobs, people and economies.”

Ends

Digitalisation critical to delivery of Roadmap 2035

The need for improved digitalisation across North Sea operations and the critical role of data in delivering Roadmap 2035, the UK oil and gas industry’s blueprint for net zero, will come under the spotlight at OGUK’s Data and Digital Day on Tuesday 25 February 2020 at The Chester Hotel, Aberdeen.

The inaugural event, chaired by Dr Daniel Brown, Executive Director of Common Data Access (CDA), a wholly owned subsidiary of OGUK, boasts a packed agenda with guest speakers lined up to outline the fundamental role of data and digital in enabling a competitive industry that realises its full potential within the energy transition.

Dr Brown said:

“I am delighted to host OGUK’s first data and digital day. Our impressive line-up of expert speakers will talk delegates through the digital journey of the North Sea as well as discuss the current digital themes in the sector, from data from drones to subsurface data science.

“We will also take a closer look at the role digital can play in improving the cost effectiveness of brown-field developments, with the ultimate aim of deferring decommissioning, and optimising economic recovery of the UK’s oil and gas reserves. With presentations touching on the full E&P lifecycle, we aim to highlight how digital capabilities are core to a competitive UK industry, that will continue to meet UK energy needs while earning our place in the low carbon economy.

“I hope those attending will gain a new appreciation of the range of opportunities that digitalisation can offer businesses and the industry more broadly as we look to deliver Roadmap 2035: our blueprint for net zero.”

Speakers include:

• Maja Kildedal, Head of Innovation and Improvements, Equinor UK
• David Lecore, Senior Compliance Manager, OGA
• Chris Frost, Data Analytics Lead, DataCo Global
• Adrien Bisset, Regional Manager Europe, Belmont Technology Inc
• Stuart Beatty, Managing Director, Kestrel Group
• Steve Aiken, Founder, Intelligent Plant
• Esther Diederen, Digital Transformation Lead, Spirit Energy

-Ends –

UK oil and gas industry outlines transition plans

The leading representative body for the UK’s offshore oil and gas industry today outlined the details of its response to UK and Scottish Government net zero commitments in a keynote speech delivered by OGUK Chief Executive Deirdre Michie OBE.

Speaking to an audience of politicians, policymakers and campaign groups in Edinburgh, Deirdre Michie said:

Good afternoon everyone and thank you for coming today.

As we all know, our country and much of the world is currently engaged in an increasingly polarised debate about climate change,

It’s passionate, important and yes – urgent.

I’ve come to you today to say that the UK’s offshore oil and gas industry is not shying away from the climate conversation but embracing it,

More than this, I want to put forward our specific proposals for the transition to the lower carbon energy future we all want to see,

It was after all Abraham Lincoln who said the best way to predict the future is to create it,

So, I’m pleased you have all been able to join us and look forward to your thoughts and reflections,

Many of you will know that OGUK’s role is to inform, engage and champion the 400 plus members operating in the UK Continental Shelf – often referred to as the North Sea,

And while this term might be convenient it is actually incorrect as it ignores the East Irish Sea and the vast frontier region in the Atlantic Ocean west of Shetland,

It is a neat – if rather dull – illustration of the need for this technical and complex but critical industry to better inform the debate with facts and tangible examples,

Facts need to be the foundation of our understanding,

Because that is what will enable us to find solutions.

And before I go on, there should be no doubt: this industry isn’t talking about what is and isn’t climate change anymore.

The facts are that the climate is changing, and we must all change if we are to protect our planet for future generations,

It will require constructive, collective and coordinated action to decarbonise a largely fossil fuel-based society which has, in relatively few years, helped to dramatically improve the living standards, health outcomes and quality of life that many of us so freely enjoy today,

But we should also be clear that the need for change also comes at a time when global energy demand is forecast to grow by up to 30 percent by 2050.

And while all industries, businesses and people need to think about what they can each do,

Our industry needs to be generous in deploying our skills, infrastructure and expertise to help find those solutions.

And we are already stepping up to the challenge.

We are an industry capable of doing big things in remarkable ways,

A capability we can – and want to – apply to the climate change challenge.

Here in Scotland, and across the UK, this industry has and continues to sustain hundreds of thousands of jobs, currently over 270,000 as per our workforce report last year.

That’s about one in every 125 employed people in the UK, or 1 in 25 in Scotland.

We’ve contributed over £350bn in production taxes alone, and more from corporation tax and Pay As You Earn as well as billions of pounds in terms of capital spend and running costs invested over the years.

Importantly, this indigenous industry has supported an affordable and secure domestic supply of oil and gas, which remains fundamental to so many of the products and fuel that we need for our everyday lives.

While we continue to emerge from one of the toughest downturns in our history and are by no means out of the woods yet, with real pressures remaining on the supply chain, it is through this incredibly challenging time that we have demonstrated our ability to transform and adapt, delivering a reputation for efficiency and competitiveness,

Operating cost reductions are being sustained and expected to remain around $15-16 per barrel this year.

And we continue to deliver safely and efficiently the day job of exploring, developing, producing and decommissioning.

We are also in action in terms of responding to the challenges of climate change,

You only have to go to Orkney, Glasgow and here in Edinburgh and visit any of our members working in your community to know that this is a challenge we are taking seriously.

And I would encourage you to do this, and to see it first-hand, some of the great work that is going on.

Stepping up to reduce carbon emissions to net zero by 2050 in the UK and by 2045 in Scotland is also an opportunity for the UK’s oil and gas industry to shine in a competitive global market.

Sustaining jobs, contributing to public services through taxation, providing secure energy supply and diversifying as we help to find solutions.

The Scottish Government has made clear that it supports a sustainable, fair and inclusive transition,

And I know the UK Government is taking a similar approach,

These are important principles which say a lot about the kind of transition Scotland wants to see.

First – it means planning for a transition which ensures people in Scotland continue to enjoy affordable and low carbon energy,

Second – this transition will deliver opportunities for the people working in the industry today as it evolves in the coming decades,

Third – the transition must deliver sustainable and enduring change,

While I welcome calls to “do more” and at pace,

We now need to move the debate on from talking about the need to act, to demonstrating what we are doing to act,

We have a plan – Roadmap 2035 – which offers a blueprint for net zero,

It is one of the first industrial responses to the UK and Scottish governments net zero commitments.

It aims to enable a safe, sustainable and competitive oil and gas industry supporting the UK’s energy needs and its transition to a net zero future,

These aspects are not mutually exclusive but inextricably linked.

Developed through over 5000 engagements with a range of stakeholders, Roadmap 2035 has been welcomed by both governments and energy ministers.

It sets out 60 actions across five key areas,

And today I can confirm that OGUK has convened an industry-wide group of company leaders and young professionals to coordinate efforts, identify gaps and drive action in pursuit of what is a truly challenging task but also a transformational opportunity,

So, to the first group of actions – our support for net zero

We will do this by reducing emissions from the operational production of oil and gas,

And through supporting other heavy emitting sectors to achieve net zero through our skills, technologies and infrastructure,

But what does this mean?

Firstly – in terms of our own production emissions, we will be a net zero oil and gas basin by 2050,

Reducing emissions from 14 million tonnes – currently three percent of the UK’s total greenhouse gas emissions – to 0.5mt – in line with the Climate Change Committee outlook,

It will require significant investment, new technology and close working with the renewables sector in Scotland and across the UK

I’m pleased to announce that we are developing targets for emissions reduction, and we will soon publish a detailed action plan in support of this — this is an industry in action.

In December last year the OGA – our industry regulator – published the interim findings of the first phase of its Energy Integration Project,

Working with BEIS, the Crown Estate and Ofgem, this important report offers a good starting point as to how we begin to bring key carbon reduction concepts to life,

Reducing emissions on oil and gas installations by using low carbon electricity including directly from offshore wind farms to replace offshore power generation from gas and diesel,

It takes me on to our second net zero commitment.

We will support the development of CCUS and other low carbon tech at scale,

The Climate Change Committee estimates that up to 175m tonnes of C02 each year will need to be captured and stored in the UK by 2050.

And that’s even if the UK delivers against every cross-sectoral recommendation in their initial report,

Indeed – CCUS is required in all decarbonisation scenarios.

Globally, some 10,000 projects will be needed,

An industry forecast to be worth around £100bn each year by 2050,

This is not only a necessary technology to meet our climate goals, it is therefore also a potential opportunity for Scotland and a diversifying energy industry.

This sector stands ready to play its part.

Assisting in the development of the commercial business models that are needed to help deliver CCUS clusters, hydrogen opportunities and the decarbonisation of offshore platforms at scale,

We are putting forward our skills, capabilities, assets and knowledge,

And working with governments and regulators to clarify policies and regulations on CCUS and hydrogen,

including improving the understanding of what is required to repurpose existing oil and gas assets for use in the low carbon world,

The CCS charter signed between the Scottish Government and industry demonstrates our commitment,

We are looking to work with governments and regulators to progress the five CCUS projects across the UK which now need to move at pace into the next phase,

One of which is the North East’s £224m Acorn project.

Expected now to be operational by 2024,

And with the potential to store 16.2m tonnes of carbon per year,

It would be good progress, but still only a fraction of what is required.

And on hydrogen,

Much more will have to be done to explore the full opportunity of this potentially disruptive player in the clean energy mix,

Reports by Swansea and Keel Universities found up to 30 percent of the UK’s gas supply can be replaced with hydrogen without needing to modify people’s appliances,

With currently 75 percent of the UK’s heating demand in buildings being met by natural gas

It shows the scale of the opportunity,

And the analysis from the International Energy Agency showing that the cost of producing hydrogen from renewable electricity could fall 30% by 2030 as a result of declining costs of renewables and the scaling up of hydrogen production helps us to begin to see what a truly transitional and transformational approach could look like,

Blue hydrogen derived from gas will need to compete alongside green hydrogen made from renewables – but both will be needed if we are to match the energy needs I referenced earlier on,

So, combining with Carbon Capture and Storage, hydrogen from natural gas could cut emissions, alongside efforts to reduce the cost of producing hydrogen from clean energy,

You can see why it matters that we do this right,

The developing hydrogen economy could also bring far-reaching benefits across Scotland,

For example, in Orkney, where a consortium led by the OGTC alongside universities and oil companies are looking to create a test centre at Flotta oil terminal for trialling these different types of technologies for use on offshore platforms,

So today we urge the UK and Scottish governments to continue to think about the full system changes from the production of energy to its use in our homes and businesses,

To recognise that this industry can help provide solutions which unlock the inclusive, fair and sustainable transition we all want to see,

And we call for a comprehensive UK energy strategy from the UK Government, to be reflected in their imminent white paper.

The Committee on Climate Change report also recognised that by 2050, oil and gas will continue to form part of a diverse energy mix,

Albeit at lower levels, roughly about a third of what it is today,

That’s because the CCC forecast that oil and gas will still be needed by those sectors especially difficult to decarbonise,

Sectors such as heavy industry and aviation, and of course its continued use in many industrial and chemical processes,

Whether its pharmaceuticals, or in producing the composite materials which, used sustainably, will continue to be critical in our daily lives,

So, I also consider it’s important we deliver as much of this demand from domestic resources – a point I’ll come back to shortly.

Meeting net zero is only the first of five themes outlined in what you can see truly is a comprehensive roadmap,

With our 2nd theme of driving technology and innovation, we will spur a net zero technology revolution, adding some £10bn in economic value to the UK through technology and innovation,

Through work being championed by the OGTC, that has already launched a net zero solutions centre in support of this ambition,

And our 3rd theme, of developing people and skills,

By 2035 we will support some 130,000 jobs,

Compared to just over 150,000 direct and indirect jobs we support today,

This will actually require us to attract 40,000 new people, a quarter of whom will be in new roles, many of which don’t exist yet, to cater for technology developments as well as the expected natural attrition from the industry through retirement,

This is being driven by the industry skills body OPITO and their innovative work through the Energy Skills Alliance to support the development of a multi-skilled energy workforce that is flexible, dynamic and technologically enabled,

In growing the economy and exports, our 4th theme,

We’re looking to double exports from a diversifying energy sector to £20bn each year,

Working with governments to deepen our sector’s understanding of international markets and ensure our experience is utilised globally and in different sectors,

And those of you who joined the excellent cross-party group held with Scottish Renewables last week will have heard how diversification in the supply chain can open the door to more international opportunities,

The final theme is on meeting the UK’s need for energy and industrial products.

I spoke earlier about the requirement to meet as much of the UK’s energy needs from domestic resources, as per the CCC report and its focus on energy sovereignty,

And their forecast that during the transition and beyond, there remains a need for oil and gas.

Let’s be clear here – the premature shut down of this industry in the UK would do nothing to impact consumption,

Those needs would instead be met from increasing the amount of oil and gas imported from across the world,

But it would also mean we realise none of the benefits this indigenous industry brings in jobs, taxation and security of supply,

Nor would it enable control over environmental governance and standards.

So, what might seem an easy and quick fix, is instead simply shifting the problem to other countries.

Which is sometimes referred to as carbon offshoring,

This isn’t fair, inclusive or sustainable, it’s actually irresponsible.

It’s an example of a transition which helps get to the same destination, but at an unnecessary cost,

Leading to unintended consequences because the changes aren’t inclusive or supported by an effective, integrated and affordable energy system,

This is not the path we need to go down, and it’s why today we are coming to you with our plan,

Building on their contribution to this great industry, we can take Aberdeen, Glasgow, Shetland, Edinburgh and everywhere in between on the journey,

We can equip people with the skills and remove barriers so that they can enjoy rewarding energy careers for decades to come,

Meaning that by 2045 in Scotland –  we will have delivered a truly fair, inclusive and sustainable transition to a low carbon future where our transformed and thriving industry is part of the solution,

It’s an exciting proposition.

One which will underpin our calls for a transformational sector deal which we will look to announce later this year,

Which is why today my ask of you all is to consider the Roadmap,

To hear out the facts and then make your call as to the role of this industry going forward.

As we look to the future, I have no doubt that it will be our shared understanding, informed by facts,

And an inclusive approach, that will enable our delivery of the net zero challenge,

Yes, we need vigorous debate, but the so-called cancel culture Obama spoke about,

The culture which says the people in our industry don’t have the right to a voice,

Undermines the fundamental principles of the inclusive, fair and sustainable transition we all want to see.

We are here and we want to help,

And we want to be a positive force in this transition,

As Jonathan Foer notes in his excellent book ‘We are the Weather’,

Collective action is the best way to save our home and way of life.

So, let’s work together, because we can.

Thank you.

OGUK responds to OGA energy transition challenge


The Chairman of the Oil and Gas Authority has challenged the UK oil and gas sector to respond to the energy transition. Commenting, Deirdre Michie, Chief Executive OGUK said:

“We are an industry in action. Roadmap 2035: a blueprint for Net Zero is one of the first major industrial responses to government plans to reduce or offset carbon emissions to net zero by 2050 in the UK and 2045 in Scotland.

“We will continue to work closely with all industry regulators including the OGA to deliver a safe, sustainable and competitive industry that realises its full potential in the transition to the low carbon future we all want to see.”

Ends

Climate change will be solved by solutions not stunts

Commenting on protests outside oil and gas offices in Aberdeen today, OGUK Stakeholder & Communications Director Gareth Wynn said:

“Climate change will be solved by practical actions not conspiracy theories and stunts. It’s disappointing that this group is choosing to disrupt the normal working day of people in this industry, causing alarm rather than engage in meaningful discussion with key decision makers.

“This industry, through our Roadmap 2035, is committed to delivering an inclusive, fair and sustainable transition to a low carbon and diverse energy mix. Again, we welcome those who are willing to take part in meaningful and solutions-focused discussions. Our industry is packed full of people with the engineering and environmental knowledge and skills to play a key part in reducing emissions and we are already taking action.”

Reshaped OGUK announced as industry gears up to deliver net zero blueprint

The leading representative body for the UK offshore oil and gas industry has kicked off the new year with ambitious plans to champion the sector as part of a diverse energy mix.

Two new directors will join OGUK’s leadership team under the continued direction of Chief Executive Officer Deirdre Michie OBE.

Katy Heidenreich

Katy Heidenreich

Trevor Stapleton is announced as OGUK’s new Health, Safety and Environment (HSE) director while Katy Heidenreich is confirmed as Operations director, both commencing their new roles on 3 February 2020.

The two new directors join a reshaped leadership team to support industry in its delivery of Roadmap 2035: a blueprint for net zero.

Matt Abraham will take on a more focused brief as Supply Chain and Exports director, directing his extensive experience in contractor companies to help grow exports and support a resilient, competitive and diverse supply chain. Meanwhile. Mike Tholen will become OGUK’s Sustainability director, using his own deep experience in the industry to help drive  action to deliver a net zero basin,  from the operational production of oil and gas and assisting the UK in reducing its total GHG emissions through to adoption of technologies including Carbon Capture Usage and Storage.

Graham Elgie continues as OGUK’s Finance and Corporate Services director and Gareth Wynn as OGUK’s Stakeholder and Communications director.

Commenting, OGUK Chief Executive Deirdre Michie said:

“2020 is synonymous with perfect vision and we are wasting no time in getting to work delivering industry’s ambitious plans for the future outlined in Roadmap 2035: a blueprint for net zero.

“I’m delighted to announce these changes to our leadership team which will enable us to even better support companies and to help drive  action as we work to inform, engage and advocate the importance of this industry as part of a diverse energy mix.

Trevor Stapleton

Trevor Stapleton

“We have a challenging but exciting year ahead of us as we work to support all our members that operate in or provide services to the UK offshore energy industry. With continued volatility in oil markets our focus remains on enabling a safe and competitive industry that delivers to its full potential within the energy transition, ensuring the North Sea remains an internationally attractive place to do business.

“Katy and Trevor each bring an incredible amount of experience and are highly regarded by their peers. Their strategic insight will be critical as we gear up to deliver our blueprint for net zero, demonstrating the practical steps companies are taking to reduce emissions, meet UK energy needs and develop our people and skills for the future.

“This industry has a positive role to play in providing solutions to the UK’s net zero challenge and we are already in action with our Roadmap. Leading from the front, OGUK is proud to champion our dynamic and diverse industry and we look forward to continuing to work with all of our stakeholders in the year ahead.”

OGUK condemns dangerous and short-sighted stunt

Commenting on news that protestors have boarded a drilling rig in Dundee harbour, OGUK Chief Executive Deirdre Michie said:

“This is a dangerous and short-sighted stunt which does absolutely nothing to help provide the solutions which will be required to meaningfully deliver net zero emissions by 2045 in Scotland.

“Worse than this, we know that the premature shutdown of the North Sea would only increase reliance on oil and gas imported from across the world where we have no control over emissions and with none of the substantial benefits our indigenous industry brings with its thousands of skilled jobs, the funding of public services and energy security.

“This stunt puts both the activists and offshore workforce at risk and our industry – with its focus on safe operations – will not condone these actions.

“If Extinction Rebellion is serious about net zero then it needs to become serious about what will be required and recognise the critical contribution our industry could make if it realises its full potential to support the transition to a lower carbon and more diverse energy mix.

“Our industry is part of the solution and Roadmap 2035: a blueprint for net zero outlines our plans to reduce emissions from the operational production of oil and gas while supporting other heavy emitting sectors to reduce emissions through low carbon technologies including Carbon Capture Usage and Storage and hydrogen. This is an industry in action, and we are committed to working with anyone to find solutions and deliver the low carbon future we all want to see.”

Ends