With UK’s new PM prioritising energy security, OEUK sees opportunity to speed up low-carbon transition
As a new Prime Minister (PM) is poised to take over the role, the UK’s representative body for the offshore energy industry, Offshore Energies UK (OEUK), believes this to be an opportunity to push the transition to low-carbon and clean energy forward by bolstering domestic oil and gas production with long-term investments to strengthen energy security, which the incoming PM announced as a top priority.
The UK’s new Conservative Party leader, Liz Truss, is succeeding Boris Johnson, who resigned in July after a series of scandals. This announcement was welcomed by Offshore Energies UK – former Oil & Gas UK (OGUK) – as “a fresh chance” to renew the nation’s approach to energy security and accelerate the transition to cleaner energies with “careful long-term investment in its home-grown oil and gas resources.”
Following Russia’s attack on Ukraine, the global energy supply crisis has driven up costs as countries across the world compete to meet energy demand. Therefore, the UK’s new PM will need to balance the short-term challenge of helping families pay their bills with the long-term challenge of keeping the lights on while tackling the climate emergency. Keeping this at the forefront, OEUK claims that there is enough oil and gas in the UK continental shelf to power the UK into the 2040s and fuel the transition to renewables.
At the end of August 2022, Offshore Energies UK warned that an increase in domestic production could only be sustained with continued investment in oil and gas reserves, which is in line with its earlier statement, urging the UK government to prioritise domestic energy production to protect consumers from supply and price shocks.
As Truss is getting ready to take the reins from Johnson, OEUK explained that it stands ready to work closely with the new prime ministerial team in number 10 Downing Street and with the Chancellor “as they are announced in the coming hours and days.” To this end, Offshore Energies UK has written to the incoming PM to propose a new summit for ministers and energy producers to help plan the way ahead.
Truss made it clear in her victory speech that energy security and helping consumers will be at the top of her priority list, thus, OEUK welcomed her to this role “at an extraordinary time for people and businesses” across the UK and intends to work with her team from day one to deliver energy security at the same time as the industry is paying taxes to the treasury and supports around 200,000 jobs across the UK, 10,000 of them offshore, producing energy from oil, gas, and offshore wind.
Commenting on this, Mike Tholen, OEUK’s Acting CEO, remarked: “We welcome Liz Truss to her new role and wish her all the very best in challenging times. A big prime ministerial inbox awaits, on top of which sits UK energy security and its critical place in countering the threat from Putin’s weaponisation of energy. As the new PM has said, we need to find a two-pronged solution both in the short- and long-term to the energy crisis.
“OEUK and our members remain steadfast partners for government and we work with political parties of all colours to ensure we carefully nurture and invest in our homegrown oil and gas industry and boost its enablement of our transition to a renewable future. We look forward to meeting with the new PM and her top team shortly and ensuring our members are front and centre of the conversations and the solutions.”
The UK’s reliance on imports means average domestic annual bills have risen from about £1,300 (around $1,499) to £3,500 (about $4,037) in less than 12 months, outlined OEUK, adding that about 85 per cent of UK homes rely on gas for heating while gas is also essential to produce about 42 per cent of the UK power.