Rivals clash over offshore oil future

David Cameron during a visit to the BP Etap platformDavid Cameron during a visit to the BP Etap platform
David Cameron during a visit to the BP Etap platform
The North Sea oil and gas industry is better supported by the “deep pockets” and “broad shoulders” of the UK economy than it would be if Scotland was independent, the Prime Minister has said.

David Cameron made the claim as he clashed with Scottish First Minister Alex Salmond over the industry when the two leaders held rival cabinet meetings just a few miles from each other in the north-east of Scotland.

Mr Cameron went on the attack in the independence debate by gathering his top team north of the border in Aberdeen and warning that leaving the UK would harm the key sector.

Hide Ad
Hide Ad

The Scottish and UK cabinet meetings were held in the wake of a report by retired oil executive Sir Ian Wood calling for measures to generate £200bn for the British economy by recovering up to four billion extra barrels from the North Sea over the next 20 years.

The Prime Minister backed that report as he insisted the oil and gas sector is better supported by the UK than it would be in an independent Scotland.

He said: “It’s more important than ever that the North Sea oil and gas industry has the backing of the whole of the United Kingdom, it has the deep pockets and the broad shoulders of the UK economy to make sure there are the tax allowances, the solidity, the investment, to make sure we can go on benefiting from this for many years to come.

“Scotland has done well out of the North Sea and the United Kingdom has done well out of the North Sea. It has been an international success story.

Hide Ad
Hide Ad

“Now. as we get to the later stages of the North Sea, long-term investment, deep pockets from the UK Government is going to be really important to recover that oil and gas.”

He rejected suggestions that Scotland or the UK should have set up a Norway-style oil fund to save for the future. “We see that North Sea revenues have built schools and hospitals and roads and railways,” he said.

“Here in Scotland they’ve sustained a level of spending per head that is ahead of that of the rest of the United Kingdom.”

But Mr Salmond, speaking after the Scottish cabinet met in nearby Portlethen, highlighted Norway as an example of a small country with a successful oil industry.

Hide Ad
Hide Ad

The Scottish First Minister said: “We are told today that North Sea oil and gas is better handled by a big country like Britain as opposed to a small country like Scotland. That’s a very interesting concept for people in this part of the country, who can glance across the North Sea to Norway, a country smaller than Scotland but a country which by every observation has handled its oil and gas resources better than the stewardship of Westminster.”

The Scottish Government has put forward plans to establish two funds if there is a Yes vote in September’s referendum –one short-term fund to deal with fluctuations in oil and gas revenues and a long-term savings fund.

But the Prime Minister claimed Mr Salmond “underplays the risks” of independence.

“This family of nations is better off together, not just that Scotland is better off in the United Kingdom but we in the rest of the United Kingdom think that we are better off with Scotland – that we want you to stay,” he said.

Hide Ad
Hide Ad

However, Mr Salmond claimed the “massive investment” currently going into the North Sea could have occurred earlier without Whitehall interference.

He said: “We’ve had 16 tax changes in the North Sea in 10 years, we’ve had 14 oil ministers in the last 17 years, three in the last four years, one thing that Scottish control of oil and gas resources will offer is a much more stable, long-term policy.”

Comment and Letters: Page 10; Why Yorkshire should watch closely: Page 11.