“I worked at Shell for 33 years – the government is wrong on North Sea oil”

I was a principal scientist for the oil company Shell, for which I worked for 33 years. I have a degree in aeronautical engineering and a PhD in fluid mechanics.

Grahame Buss www.independent.co.uk

I recently read a letter from the business and energy secretary, Kwasi Kwarteng, in which he tries to justify government plans to encourage investment in new North Sea oil and gas. He says it would “protect Britain’s energy security” and smooth the “transition to cheap, clean, home-grown energy”, as well as cutting energy bills.

But expanding North Sea oil will do none of those things, for several reasons.

We don’t own the oil and gas, which we give away to energy companies together with substantial subsidies. They sell the oil and gas to the highest bidder on international markets, keep all the revenue, and are currently making eye-watering profits on which they pay almost no tax. Almost 80 per cent of UK production of crude oil is exported and plays no part in our domestic energy security.

We don’t own the companies that exploit this oil and gas. According to one study, more than a third of the licence blocks in the North Sea now have a private or state-backed controlling interest, with fossil fuel firms from China, Russia and the Middle East playing an increasingly dominant role. As well as being unaccountable to UK shareholders, these businesses have no strategic interest in UK energy security or in keeping bills low for UK households.

We don’t own the refineries. They are owned by private companies like Essar (Indian-owned, and reportedly had links to Russian company Lukoil), Petroineos (Chinese joint venture) and Exxon Mobil.  To make money these refineries must run close to full capacity with specific types of crude oil not found in the UK. Reconfiguring is expensive, so the refineries have a strong interest in tying us into foreign crude imports.

We have no control over the price of oil and gas. Producing our own oil and gas does not guarantee that it is available to UK consumers at a price they can afford, as the recent energy price crunch has demonstrated. We pay the international price of oil no matter where it comes from. Fluctuations in the oil price both up and down are felt directly by us.

We can’t just turn on a tap. Allowing new UK oil and gas production is not a quick fix to plug the small gaps caused by the Russian invasion of Ukraine. The new licences in the North Sea will take years to come on stream – an average of 28 years from the licence being granted to production, says the Climate Change Committee. Even the “easy” stuff can take up to 8 years depending on the geology.

So despite Kwarteng’s plans, the UK public will remain vulnerable to global instability in oil availability and price for the foreseeable future.

As for smoothing “the transition to cheap, clean, home-grown energy”. What kind of clean energy investment signal is the government sending by continuing to subsidise fossil fuels?

By refusing to recognise and incentivise investment in the most cost-effective opportunities to cut carbon – solar and wind energy, insulation and free public transport – it is destroying jobs and ensuring higher and more volatile energy bills are baked in.

The only way to be truly secure is to exit fossil fuels and invest in the alternatives.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.