September 4, 2019

The UK’s offshore oil and gas industry has outlined its contribution to the UK and Scottish Government net-zero ambitions as part of an ambitious blueprint showing what the sector could look like in future.

Roadmap to 2035: A Blueprint for net-zero sets out five key themes requiring industry, government and regulator action to ensure the sector can continue to provide secure energy supply, support net-zero and remain a vital contributor to the UK economy.

It includes coordinating activities to reduce emissions from the production of oil and gas, which currently accounts for 3 percent of UK total greenhouse gas emissions, and understanding how the UK oil and gas industry can play a key role in developing and commercialising low carbon technologies including Carbon Capture Usage and Storage and hydrogen.

The roadmap 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. It is published following extensive engagement with over 2,500 industry stakeholders. The roadmap is the centrepiece of a flagship report published today by the leading representative body for the industry.

OGUK’s Economic Report 2019 reinforces the importance of the sector to the UK’s economy and to meeting the energy needs of consumers. It shows how the UK oil and gas industry can contribute to the transition towards net zero emissions in the UK. The report shows 75 percent of the UK’s current energy needs are met from oil and gas, with just over half (59 percent) of oil and gas demand met by domestic production. It highlights Climate Change Committee forecasts that the UK will still consume around 65 million tonnes of oil equivalent per year (roughly 45 percent of current demand) in 2050, making carbon capture and development of hydrogen essential.

The report notes that continued collaboration between industry, government and regulators will be required to maintain the competitiveness and sustainability of the basin so that as much as possible of UK demand is met from our own resources rather than imports in parallel with efforts across all industries to reduce emissions.

Commenting, OGUK Chief Executive Deirdre Michie said:

“Roadmap 2035 shows an industry in action with a credible plan for the future. While we don’t have all the answers to the big challenges we face, we have started work on what we know can be done. We are ready to work with others in developing some of the new solutions the UK needs, and the Net Zero Solutions Centre is a great example of this.

“The facts outlined in our report evidence that our industry remains a vital economic asset and is uniquely positioned to help the UK meet its net-zero ambitions and energy needs in the years to come.

“We now need a comprehensive UK energy strategy which recognises the continued role of oil and gas in a diverse energy mix and positions us to support net zero.

“Our Economic Report 2019 shows we are already playing an active role in the transition to a more diverse energy mix, with many of our members investing in renewables, developing new technologies and bringing new solutions to market.

“Roadmap 2035 offers a blueprint for how we can continue to meet much of the UK’s oil and gas needs from domestic resources, progressively reduce associated production emissions and develop economy-wide decarbonisation technologies. With 40,000 new people needed in our industry, a quarter of whom will be in roles which don’t currently exist, it is an industry with an exciting future.

“It’s why we must continue to focus on improving the sustainability of the basin. This sector has seen a remarkable turnaround from one of the harshest declines in memory, however significant parts of the supply chain remains in a fragile condition.

“Our Economic Report 2019 shows a greater proportion of UK demand being met from domestic production, exploration and drilling activity on the increase and a continued pipeline of new projects emerging. We need to build on this investment to encourage new fields to be developed to replace those coming to the end of their life. This will ensure as much as possible of UK demand is met from our own resources.”

Business, Energy and Clean Growth Minister Kwasi Kwarteng said:

“Roadmap 2035 shows how seriously the UK’s oil and gas sector is taking its mission to decarbonise and support the transition to net zero emissions by 2050.

“The highly skilled offshore energy sector will be integral to the UK’s energy transition, developing solutions to further bolster the sector’s significant contribution to our economy.”

Paul Wheelhouse MSP Minister for Energy, Connectivity and the Islands said

“I welcome the Vision’s roadmap to 2035 as it marks a significant move by the industry to reflect the need to make the energy transition a reality. The sector can and has committed to helping Scotland and the UK achieve net zero, working with both governments, as well as industries and communities to transform our energy system.

“We are committed to achieving a net-zero economy in a way that is fair for all and to ensure a just transition. The oil and gas sector can and will, I believe, play a positive role in this transition, helping to channel its resources and innovative supply chain to design the diverse energy system we need for the future. The Industry’s Vision 2035 can be a blueprint to deliver net zero and a sustainable future for the sector. The knowledge, skills and experience of the workforce will also be of vital importance for developing and investing in low carbon technologies, such as Carbon Capture Utilisation and Storage, hydrogen and floating offshore wind projects.”

UK Government Minister Colin Clark said:

“I am pleased to see the oil and gas industry publish their blueprint for net-zero. Scotland’s oil and gas sector will play a leading role in the UK Government’s commitment to net-zero by 2050. Investing in new technologies like CCUS and hydrogen is key to unlocking the industry’s future and decarbonising the UK economy.

“Our industry is the safest in the world and the UK Government recognises this, continuing to support the sector through a £2.3 billion fiscal package and the £250 million Aberdeen City Region Deal. Improving the sustainability of oil and gas in the North East ensures the industry has years ahead of it, continuing to provide jobs and invest in Scotland’s economy.”

 

Ends

 

Notes:

A video of the roadmap can be found here. 
The report can be found here.

Issued by the Communications Team, Oil & Gas UK. Contact Communications Manager Natalie Coupar 01224 577343 / ncoupar@oilandgasuk.co.uk

Oil & Gas UK is the leading representative organisation for the UK offshore oil and gas industry. Its membership comprises oil and gas producers and contractor companies