Taskforce convened to help North Sea oil industry

Scotland’s energy minister will chair regular meetings of a leadership taskforce in a bid to help the North Sea oil sector survive the plunge in prices caused by Covid-19.

Paul Wheelhouse has pledged to convene monthly meetings of the Strategic Leadership Group on Oil and Gas and Energy Transition – with the first taking place next week.

It comes after a report from industry body Oil and Gas UK (OGUK) warned as many as 30,000 jobs could be lost from the sector over the next 18 months.

Demand for energy has plummeted as more than half of the world’s population is in some form of lockdown, OGUK said, with oil prices having plunged during the coronavirus pandemic.

An extraordinary meeting of the leadership group earlier this month heard directly from the industry about the challenges it is facing.

Now the group, chaired by Wheelhouse and including key figures from OGUK, offshore operators, trade unions and wider industry representatives, will meet regularly throughout what the minister said is an “extremely difficult time”.

He said: “The oil and gas industry is a critical component of our economy and has a crucial role to play in the transition to a net-zero economy.

“A lot of work has been going on behind the scenes to fully understand what challenges our energy sector, including renewable energy, is facing in response to Covid-19 and physical distancing measures.

“Last week the situation became even more difficult for the oil and gas sector specifically, as the oil price crashed even further amid a drop in domestic and global demand, alongside a current global oversupply.”

Wheelhouse said the Strategic Leadership Group “will adopt a taskforce approach that will initially focus on the Covid-19 response, the longer term economic response and the route map for energy transition”.

He added: “We must ensure the industry and its supply chain continue to have a sustainable future in the longer term and that it can fulfil the important role we need it to perform in the energy transition in areas such as carbon capture utilisation and storage, the hydrogen economy and developing floating offshore wind.”

With “many of the key levers needed to support the sector” at Westminster, he said the Scottish Government will “seek to work closely with the UK Government to ensure both governments are doing all they can to protect jobs and retain vital skills”.

Wheelhouse said: “This is an extremely difficult time for our business community and we recognise the need to do all we can to help key sectors recover.

“The First Minister has committed to look at what further steps can be taken to support our oil and gas sector, and these meetings will be a valuable part of understanding how the Scottish Government can – critically – support our workforce, and ensure the energy transition agenda continues to meet our net-zero emissions ambition.”