New North Sea oil and gas licensing

Energy policy, and specifically the future of the North Sea, is a clear dividing line between the main political parties in this general election. Here we look at some of the claims being made, and if policies have popular support in Scotland. ‍

• The North Sea is in decline: new licensing will provide just 4 days worth of extra gas a year on average between now and 2050
• In the past decade, despite the government issuing hundreds of licences, the number of jobs supported by the oil and gas industry has more than halved
• Two thirds of people in Scotland believe that more investment in renewables and energy efficiency measures will provide Scotland with a secure and affordable energy system in the future

New licensing will not boost UK energy security 

‍After 50 years of drilling, the North Sea is in decline. The UK has burned most of its gas and most of what’s left in the North Sea is oil, most of which the UK exports. 

New licensing will do very little to boost domestic production. In the past 13 years, hundreds of licences have been issued through six licensing rounds, which have led to only nine weeks worth of gas being discovered and only 16 days worth of gas actually being produced. Between now and 2050, new licences are expected to provide just 103 days of gas at today’s demand – that's four days worth of gas a year on average. 

According to the former head of the oil and gas regulator, new licences would only make a difference to gas production ‘around the edges’. Even BP’s ex-CEO has said that North Sea drilling is “not going to make any difference” to Britain’s energy security.‍

‍New licensing will not stem the decline in jobs

‍There are currently over 200 developments in the North Sea, which are set to produce oil and gas for decades to come. But, with reserves now dwindling and becoming harder to reach, new licensing will not prevent the ongoing decline in jobs.

The number of jobs supported by the oil and gas industry has more than halved in the last decade – from 441,000 to 214,00 today – during which time the government has issued hundreds of new licences in six separate licensing rounds. 

This decline has not been effectively offset by increased jobs in other parts of the energy sector, revealing a failure to invest in transitioning the workforce – over 90% of whom want a clear path out of high carbon jobs – and the urgent need for a coherent transition plan for the North Sea that includes concrete policy offers to urgently advance action on a just transition.

The Scottish public favour a transition to clean energy

Two thirds (67%) of people in Scotland believe that more investment in renewables and energy efficiency measures will provide Scotland with a secure and affordable energy system in the future, according to a major new Scottish poll.* This compares to fewer than a quarter (23%) thinking that more investment in North Sea oil and gas drilling is more likely to deliver energy security. 

Over half (52%) of respondents under 35 support policies, such as an end to licensing, to encourage oil and gas companies to invest in renewables.

The research also showed that three quarters of those surveyed do not trust oil and gas companies to handle the green transition. Even in Aberdeen, just a fifth (21%) of respondents have faith in the industry to ensure that the shift to clean energy benefits workers and communities dependent on the sector.

‍New licensing will not solve the UK’s energy crisis  

The central problem facing the UK is not one of energy supply, but energy affordability. Average energy bills are still 50 percent more than three years ago and bills are set to rise again this autumn. As a result, many households still struggle with high energy bills, while millions are in energy debt.

Increasing domestic supply will make no difference to gas prices, a fact that government ministers have publicly admitted on multiple occasions. The only way to permanently lower bills and deliver genuine energy security is to insulate homes and accelerate the building of homegrown renewable energy and rapidly transitioning our homes and transport away from fossil fuels.

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‍* Polling commissioned by Uplift and conducted by Diffley Partnership in May 2024 assessed the views of 2660 Scottish adults.