Latest news with #OEUK
Business News Wales
11-07-2025
- Business
- Business News Wales
Offshore Energies UK Urges More Action to Reach Government Clean Power 2030 Target
Offshore Energies UK (OEUK) has proposed key reforms to accelerate offshore wind generation following the UK Government's publication of its Review of Electricity Market Arrangements (REMA). OEUK says the decision to take a national approach to pricing will encourage more wind energy investment to help the Government hit its Clean Power 2030 targets and boost growth in the critical offshore energy supply chain. The National Energy System Operator has given 5,000 energy projects in the queue for grid connections until 29th July to submit evidence for preferential treatment. The move is intended to prioritise 'shovel-ready' projects and scrap the first-come, first-served approach, which has allowed speculative schemes to delay viable clean energy developments. This proposal must be matched by reforms to the Contacts for Difference (CfD) scheme and planning system to ensure the next allocation round – AR7 – delivers the scale and pace needed. OEUK's analysis shows that to meet the CP30 goal of 95% clean power by 2030, the UK must deliver half of this target from offshore wind. This means at least 43 gigawatts of offshore wind capacity must be installed by 2030, but current projections fall short at just 35GW. The next three CfD rounds must therefore secure an additional 20GW- equivalent to powering around 15 million homes. Only two offshore wind generation projects – GreenVolt in Scotland and East Anglia Two – have been supported by the Government's CfD scheme since 2022. A clear regulatory framework that secures investment and maintains the UK's position as a global leader in offshore wind is now imperative, says OEUK. It added that offshore wind is one of the UK's greatest energy success stories – generating low carbon electricity at scale, creating jobs, and revitalising coastal communities. Fixed-bottom turbines, with so-called monopiles attached to the seabed in shallower waters, have driven the UK's rapid growth of wind energy generation to date but floating wind turbines using newer technologies, can be anchored in deeper waters with stronger wind resources, opening new areas for development. The also have fewer environmental constraints than fixed-bottom projects and can progress more smoothly through the consenting process, said OEUK. Speed and clarity to reform grid access and a more transparent approach with equal treatment for fixed and floating wind farms would give developers and the supply chain greater confidence to invest, it added. OEUK's key recommendations for AR7 and beyond: Support for offshore wind: Provide assurance that sufficient funding is available for both fixed and commercial floating wind projects over the next three years, including projects to decarbonise offshore oil and gas operations, strengthen the UK supply chain, and create export opportunities. Grid and consent reform: Improved risk sharing between developers and grid network operators plus increased administrative capacity and streamlined planning to reduce delays to grid connection. Compensation should be offered for unexpected hold ups. Eligibility and investment: Reform eligibility criteria to allow both fixed and floating wind projects that have not received full consent to bid in the auction, extend CfD contracts from 15 to 20 years and introduce a well-balance cap and floor to transmission charges to improve investor confidence, lower subsidies and reduce costs to consumers. Introduce a well-balanced cap and floor to transmission charges. OEUK's Wind Energy Manager, Thibaut Cheret, said: 'AR7 must be the turning point in making UK wind ambitions a reality. That means enabling floating wind to compete on equal footing, unlocking grid access, and giving developers the confidence to invest at scale. 'We're calling for clear eligibility rules that allow well-progressed but unconsented projects to bid, longer CfD terms to reduce costs to consumers, and a firm commitment to grid and consenting reform – including compensation for delays. These are the changes our members need to deliver the next 20GW. 'At the same time, we are working with our members to reduce project risk and borrowing costs as well as improving contractual relationships and promoting standardisation of modular wind turbine components to make them cheaper and faster to install. 'There is only one energy supply chain for offshore wind and oil and gas – and it cannot be allowed to decline. With the right reforms and a pragmatic energy strategy which supports homegrown oil and gas alongside the acceleration of UK renewables, the North Sea can remain a global energy powerhouse, supporting economic growth, jobs, and our climate goals.' ScotWind: OEUK supports the ambition of the ScotWind leasing round and is calling for clarity on delivery timelines, grid access, and supply chain investment to ensure projects can rapidly move forward. OEUK supports the ambition of the ScotWind leasing round and is calling for clarity on delivery timelines, grid access, and supply chain investment to ensure projects can rapidly move forward. INTOG: OEUK backs INTOG schemes using wind energy to decarbonise offshore oil and gas production. We are urging government and regulators to ensure these projects are prioritised for grid access and CfD eligibility, and that planning processes reflect their dual role in emissions reduction and clean power generation. OEUK backs INTOG schemes using wind energy to decarbonise offshore oil and gas production. We are urging government and regulators to ensure these projects are prioritised for grid access and CfD eligibility, and that planning processes reflect their dual role in emissions reduction and clean power generation. Celtic Sea Round 5 of Celtic Sea wind auctions held last month aims to unlock the potential for floating offshore wind off the coasts of South Wales and Southwest England. The Crown Estate has selected Equinor and Gwynt Glas to develop two 1.5GW floating wind farms. The leases come with grid connections already approved, but only two out of three leases on offer have been taken up. TNUoS: Transmission Network Use of System Charges. Transmission has a cost which is paid by the generator and the user which appears in electricity bills. This cost is expected to increase dramatically in future years as more energy is brought from Scotland to England. The connection cost for the generator rises for remote areas but in heavily populated areas generators are paid to connect. The price difference must be adjusted with a proposed cap and floor system that would introduce an upper maximum cost to Scottish projects. Transmission Network Use of System Charges. Transmission has a cost which is paid by the generator and the user which appears in electricity bills. This cost is expected to increase dramatically in future years as more energy is brought from Scotland to England. The connection cost for the generator rises for remote areas but in heavily populated areas generators are paid to connect. The price difference must be adjusted with a proposed cap and floor system that would introduce an upper maximum cost to Scottish projects. Review of electricity market arrangements (REMA): The government is still to announce the full outcome of its REMA consultation beyond the already published decision on zonal pricing. OEUK is calling for introduction of 'deemed contracts for difference' (based on potential, not actual output). This would mean wind energy producers being paid according to their potential capacity in a system that would give producers the opportunity to benefit from high global wind energy prices when they are available and keep a proportion of the additional profits
BBC News
10-07-2025
- Business
- BBC News
North Sea operators 'running out of time' to plug old oil wells
North Sea operators have been warned that they could be fined if they continue to delay on the decommissioning of oil and gas wells. Industry regulator the North Sea Transition Authority (NSTA) said firms were "running out of time" to tackle a backlog of more than 500 wells to be cost - estimated at £41bn - is shared between the private sector and the taxpayer. It said that further hold-ups would cost a further £4bn. Offshore Energies UK (OEUK) said "policy instability" in the industry had created uncertainty, but said the sector was still committed to decommissioning. When an oil well comes to the end of its life, its operator has a responsibility to permanently decommission began an investigation after identifying hundreds that had missed plugging said that any delays risk rig operators and others in the supply chain moving their vessels out of the North Sea to seek work elsewhere. The regulator said that this would push up the costs in the long run. If the backlog is not addressed, NSTA said there could be more than 1,000 additional wells due for decommissioning by the end of the decade. Pauline Innes, NSTA director of supply chain and decommissioning, urged operators to act said: "The stark reality is that operators are running out of time to get to grips with the backlog as more contractors consider taking their rigs abroad, which damages the supply chain's ability to meet demand and remain cost competitive."She said NSTA was prepared to help operators when necessary but would "get tough" on those who continually delay. Significant uncertainty In 2024, only 103 wells were decommissioned to the final abandonment stage with some form of work being carried out on 223 300 need to be fully commissioned each year if the backlog is to be body OEUK said businesses were actively progressing their decommissioning obligations but that it was a complex manager Ricky Thomson said: "Policy instability, including the Energy Price Levy and pauses in the Environmental Assessment process, has introduced significant uncertainty for the sector resulting in project delays and cost increases. "The sector is working with the government to provide stable regulatory and fiscal frameworks to continue delivering safe, efficient decommissioning essential to the UK's economy, environment, and long-term energy future."
The Herald Scotland
04-07-2025
- Business
- The Herald Scotland
Oil price volatility concern as North Sea job losses mount
'I think it is true when the Prime Minister says energy security is national security,' he said, adding: 'Over 40% of our energy demand was imported last year and I think in an uncertain world, you know that's the wrong place to be.' The reliance on imports leaves the UK vulnerable to a disruption to supplies, reckons Mr Whitehouse. He claims the country is depriving itself of huge amounts of economic value that are enjoyed instead by countries it buys oil and gas from. Imports may result in an increase in emissions compared to UK sources when related production and transport operations are taken into account. 'If we do it here in the UK that protects jobs, puts real value into our economy and we deliver that with a lower carbon footprint so I think the case for having home-grown oil and gas is compelling,' said Mr Whitehouse. READ MORE: As Chevron closes Aberdeen office, what now for North Sea jobs? Scale of SNP Government climate change failings underlined by experts Israeli-owned firm takes control of UK's biggest gas field The oil and gas industry veteran noted that an expert report for OEUK published in June found that up to 7.5 billion barrels of oil and gas could still be produced from UK waters. The figure is around 3.2 bn barrels higher than current government estimates. OEUK has highlighted the fact that the Climate Change Committee, which advises the Government, has forecast that in a scenario where the UK meets all its climate targets on time homes and businesses will still use between 13 and 15 billion barrels of oil and gas. The potential additional 3bn barrels production that OEUK thinks is possible could be worth £165 billion to the UK economy in total and support thousands of jobs. Under Mr Whitehouse's leadership OEUK will focus much of its effort on campaigning for cuts in oil and gas taxes as the Government prepares to publish the results of a review of the fiscal regime. North Sea firms complain the tax burden has increased significantly since the windfall tax was introduced by the former Conservative Government in 2022. The rate of the energy profits levy has been increased since then, most recently by the Labour Government in the Budget in October. While the tax was imposed after oil and gas firms posted bumper profits, Mr Whitehouse claimed it has caused lots of damage. He said one way of highlighting that would be that fact that in 2019 the former Oil and Gas Authority predicted that over 6bn barrels of oil and gas would be produced from the UK North Sea between 2025 and 2050, with over 10bn possible. That compares with the successor North Sea Transition Authority's forecast of around 3.5bn. 'The underlying geology in the North Sea hasn't changed but the environment and the uncertainty has and the windfall tax has played an important role in that, it is deterring investment' claimed Mr Whitehouse. 'As we look forward to the second half of the year we are seeing a rapid drop off in terms of rig activity in the North Sea.' OEUK chief executive David Whitehouse claims oil and gas firms can play a key role in the development of renewables assets off Scotland (Image: OEUK) The Government has come under pressure to bring forward the date for the ending of the windfall tax to 2026 from 2030. Chancellor Rachel Reeves gave no ground when she published the results of the key Comprehensive Spending Review in June. However, Mr Whitehouse hopes that OEUK could still win concessions. 'The Treasury has some very thoughtful mechanisms which mean that in the event that prices spike the tax on the sector would increase,' he observed. There are details to be considered but OEUK wants the successor regime to be implemented in 2026. Mr Whitehouse is confident that the resulting boost to activity would allow the Government to recover more revenue than it lost as a result of easing the tax burden. He noted: 'In a regime where you're paying high tax that is causing investment not to happen … that does reduce your economic growth actually, it also ultimately reduces your tax receipts.' OEUK welcomed the results of the review of the field development consenting process the Government published this month – although energy minister Ed Miliband's plans to stop issuing exploration licences for new areas is a cause for concern. The consenting review was launched after a Scottish court ruled the Conservative Government was wrong to approve plans for the controversial Rosebank development off Shetland - because the assessment process failed to take into account the emissions that would result from use of the oil concerned. Under the Government's plans firms will be required to submit environmental impact assessments in respect of proposed field developments that do consider such emissions. 'We welcome that the guidance has come out, it is an important step to projects moving forward,' said Mr Whitehouse. The regulatory change could have positive implications for the planned Rosebank, Jackdaw and Cambo developments, all of which are opposed by environmentalists. READ MORE: North Sea jobs cull looms after blockbuster oil and gas deals Mr Whitehouse hammered home claims that the UK needs to ensure that it has a strong oil and gas supply chain if it is to make the most of the potential of low carbon energy generation and carbon capture and storage technology to support the net zero drive. Oil and gas firms have the expertise required to develop offshore facilities such as windfarms and some have shown they are willing to invest directly in developments. OEUK's membership includes firms that are active in renewable energy generation, hydrogen production and carbon capture and storage. It evolved out of the former Oil and Gas UK. 'If we manage the opportunity right and in a pragmatic way, which is support for oil and gas while we still use it then we see significant opportunities, particularly floating wind, carbon capture,' Mr Whitehouse said. 'I think there's huge opportunities for Scotland the wider UK … not just storing emissions from UK industry but storing them from Europe.' In June the UK Government confirmed it would provide £200m funding for the Acorn carbon capture and storage project, which will involve capturing industrial emissions and transporting them for storage in depleted North Sea reservoirs. It also announced £500m funding for UK hydrogen projects and a £1bn offshore wind supply chain initiative. Mr Whitehouse said OEUK very much welcomed the announcements concerned, which should help to generate momentum in the low carbon sector. However, noting that the number of jobs created in the sector so far has remained lower than expected, he cautioned: 'It is good to have ambition. It is good to set targets. But for those targets we need to make sure that they become real, that … people can feel that there are genuine delivery plans that sit underneath them.' The prize could be huge if politicians and industry play their parts effectively. That will require people to recognise that the UK will need oil and gas and the related supply chain for years as it builds out the low carbon generating systems it is hoped will eventually meet its energy requirements. Noting that 90,000 jobs are supported by the oil and gas sector, Mr Whitehouse appeared optimistic about the future despite the concern about the geopolitical outlook. 'I think over the coming decades, I would like to see that integrated energy sector significantly increasing the number of highly skilled, well-paid jobs,' he said. However, the prediction came with the caveat that 'it's that integration that I think is going to be the path to success'.
New Statesman
02-07-2025
- Business
- New Statesman
Let's choose a homegrown energy future
Image: OEUK The UK offshore energy industry is vital to our national interests. It powers our homes, fuels our economy, supports skilled jobs across the country, and helps to drive down emissions. As the UK moves towards a lower-carbon future, this sector will remain essential in meeting the country's energy needs while building the infrastructure of tomorrow. From offshore oil and gas to wind, hydrogen and carbon capture, the sector is already delivering the mix of energy sources needed to keep the lights on, grow the economy and progress towards net zero. But it needs a clear, stable energy strategy from government to continue investing, protect jobs, and ensure UK energy security. This is not a theoretical debate, but a practical one. The choices made today will affect energy bills, jobs, investment and emissions for decades. Currently, around 75 per cent of the UK's energy comes from oil and gas. These fuels are essential—not just for heating and transport—but for making products like steel, chemicals and cement. While demand will fall over time, it won't disappear overnight. Even in the most ambitious net zero pathway, the UK will need oil and gas for decades. The Climate Change Committee estimates we'll need 13 to 15 billion barrels by 2050, yet we're on track to meet less than a third of that from domestic resources. With the right policy environment, we could meet up to half of that demand, supporting energy security, protecting jobs and delivering over £150 billion in economic value. Every barrel we produce at home is one we don't import. Relying on imports means exporting jobs, raising emissions, and losing control of our energy future. It also increases vulnerability to global shocks. Subscribe to The New Statesman today from only £8.99 per month Subscribe The offshore sector supports over 200,000 UK jobs, including 90,000 in Scotland, and contributes £25 billion annually. It's already delivering major low-carbon projects and is one of the UK's biggest infrastructure investors. But these jobs are at risk. A report from Robert Gordon University warned tens of thousands could be lost by 2030 without policy support. The solution lies in expanding renewables while avoiding an accelerated decline in oil and gas production. We're already seeing warning signs. In May, Harbour Energy announced 250 job losses, and Ørsted paused the Hornsea 4 wind project—both citing rising costs and investment challenges. We are not making the most of our natural resources. We need pragmatism to unlock them responsibly. As the UK seeks more energy investment, delays and job losses highlight the urgent need for stable policy. The UK has set ambitious climate targets, and the industry shares that ambition. Producers have cut production emissions by 20 per cent since 2018 and aim to halve them by 2030, reaching net zero by 2050. The same infrastructure and expertise that powers oil and gas today is enabling new technologies like carbon capture, hydrogen, and floating wind. The Green Volt project off Peterhead illustrates this. Floating wind turbines will power oil and gas platforms and provide clean electricity to homes—using supply chains built through decades of experience. The UK has the natural advantages to lead in offshore energy: the second-largest offshore wind capacity globally, geological potential for carbon storage, and remaining oil and gas reserves. But without the right investment climate, these opportunities may go elsewhere. In Q3 2024, the UK imported nearly 40 per cent of its energy. Meanwhile, prices remain higher than in many European countries. We need a balanced, pragmatic policy. A successful North Sea requires practical solutions that protect jobs, attract investment, and maintain control over our energy mix. The offshore sector is investing in the future but needs stability and confidence from government: clear licensing, fair taxation, and a supportive investment environment. This is a crucial moment. The decisions we make now will shape our energy future, job market, and climate leadership. Let's choose a homegrown energy future. Related
Scotsman
29-06-2025
- Politics
- Scotsman
North Sea boss warns 'polarised' oil and gas debate putting jobs at risk and makes Rosebank prediction
Sign up to our Politics newsletter Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... The head of the organisation that represents the North Sea energy industry has warned the 'polarised debate' over the future of oil and gas is risking efforts to tackle the climate crisis and putting jobs on the line. David Whitehouse, the chief executive of Offshore Energies UK (OEUK), told The Scotsman that he and his colleagues in North Sea industries 'care as much about dealing with climate change as anybody'. The assertion came as he revealed some optimism about a 'pathway' emerging for the controversial Rosebank oil field and Jackdaw gas field developments to be approved and drilling to begin. Advertisement Hide Ad Advertisement Hide Ad Campaigners take part in a Stop Rosebank emergency protest outside the UK government building in Edinburgh. PIC: Jane Barlow/PA Wire Speaking at the OEUK conference in Aberdeen, Mr Whitehouse, a former production engineer for Shell, is a prime example of fossil fuels transitioning to renewable energy - as he is studying for a masters in renewable energy. With the debate around the role oil and gas will play in the energy transition remaining as toxic as carbon emissions, Mr Whitehouse has insisted the heat is coming from extremists on both sides of the argument - with the majority wanting a measured approach to net zero that will boost the economy. READ MORE: Rosebank and other North Sea oil and gas fields could be given green light under new guidelines The UK government and experts have stressed oil and gas will be needed until net zero is reached. Advertisement Hide Ad Advertisement Hide Ad Time for majority to 'speak up' on industry support Asked about the polarised debate, Mr Whitehouse said it was "simply not the case' that 'it's one versus the other, renewables versus oil and gas'. He added: 'I do think a polarised debate is what will stop us being truly successful dealing with climate change and dealing with it in a way that supports jobs and value in our economy. 'I think removing the polarisation from the discussion is really important.' Advertisement Hide Ad Advertisement Hide Ad Mr Whitehouse warned 'sometimes it feels like we're having a polarised debate', but the majority want to see climate change tackled 'in a way that supports existing businesses and industries' and 'see that role for oil and gas - domestic, home-grown oil and gas supporting communities around the country'. David Whitehouse, chief executive of OEUK | Michal Wachucik He said: 'So what you actually find is this isn't a polarised debate within the public - it's just at the extremes. Those loud voices on the extremes are what we are hearing. 'Now more so than ever, that 70 per cent who sit in the middle who want to deal with this in a pragmatic way, who recognise we need it all. Now is the time for us to speak up.' Mr Whitehouse stressed the industry was facing 'an uncertain time'. Advertisement Hide Ad Advertisement Hide Ad READ MORE: GB Energy to take Scandinavian inspiration to become power company amid renewable slowdown alarm He said: 'We see the announcement of job losses at Harbour Energy. We are concerned that we are seeing record-low levels of rig activity. That has real-world consequences.' Concern over renewables slowdown The UK and Scottish governments have insisted the renewables boom will be ramped up at such a pace that it will keep investment flowing into offshore industries. But Mr Whitehouse has warned the pace of both the decline of the oil and gas sector and the expected expansion of renewable energy were concerning. He said: 'We have seen policy decisions over the last [few] years that I think have accelerated the decline in oil and gas. It does not have to be that way. We can reverse that and produce more of the oil and gas that the UK will need. Advertisement Hide Ad Advertisement Hide Ad 'I think there's been real momentum behind the build out of renewables, which is something that we welcome. But there are some issues to be dealt with - in terms of planning and consent, access to grid and financing those projects. 'There is a concern we are seeing a quicker decline of one significant industry, and I think we can reverse that. And we need to accelerate the build out of renewables.' The UK Labour government has vowed to ban new oil and gas licences and is consulting on ending a long-held policy for Britain to seek 'maximum economic recovery' - essentially drain all of the oil and gas from the North Sea. Advertisement Hide Ad Advertisement Hide Ad UK Energy Security and Net Zero Secretary Ed Miliband | PA Mr Whitehouse said: 'The Climate Change Committee said that on our journey to net zero, we are going to require something like 15 billion barrels of oil and gas. We're on track to produce about a third of that. 'With supportive policy, I think we can produce at least half and that creates real value in our economy and supports our jobs.' He added: 'What we really need, also, is there are opportunities around our existing hubs, around those assets like mini towns in the middle of the North Sea. We need the opportunity to bring in some of those other opportunities in those hubs to extend their life.' Advertisement Hide Ad Advertisement Hide Ad Lifeline for Rosebank The Rosebank and Jackdaw projects have been instructed to reapply for environmental consent after the Supreme Court ruled their permission was unlawful and will have to set out the environmental impact of burning the oil and gas contained in the developments. A map showing the location of the Rosebank and Jackdaw oil fields | Kimberley Mogg/NationalWorld Updated guidance published by the UK government last week, suggested environmental consent could be granted to the two projects and an estimated 13 others, if the economic benefits can be proven to outweigh the climate harm. Mr Whitehouse said the new guidance 'provides a pathway to the projects'. He said: 'Now we've got some critical decisions that lie ahead of us and we just need to get these right. Advertisement Hide Ad Advertisement Hide Ad 'I wouldn't say this is the last chance, but I think it is critical that we do get this right. We are seeing an accelerated decline in our oil and gas production in a world where I think we need that. 'We need to be really clear. This is not a debate about oil and gas versus renewables. It's not a debate actually about dealing with climate change versus economic growth. I think if we get this right, we can deliver both. But it is an argument about whether we support our home-grown industries over imports.
