Let’s drill into the facts on Sunak’s oil and gas claims

So, we had the flying visit from the UK Prime Minister, who came north for a desperate attempt to hold on to the few seats the Tories hold in the area. I’ll be honest, what he had to say will have gone down well with many, but any boost will be short and will leave a very bad taste.

First up, we welcome the long overdue announcement of the Acorn project getting track two status, but call us cynical if you like, we have been here before, on countless occasions.

After the fanfare of the announcement, it became very clear that no details of how and how quickly this project will proceed were available; it was little more than a photoshoot. Tier one carbon capture, utilisation and storage (CCUS) projects got the go-ahead two years ago and have not progressed one inch since.

Holding our breath waiting for real progress on Acorn would be a very risky game.

The sad thing is that we had a lead over the rest of the world on CCUS and have had to watch on as UK governments piss our lead against the wall. While the UK was dithering, other similar-sized nations to Scotland were getting on with it. Next year, the Greensands project in Denmark will start the commercial injection of carbon into depleted ex-gas wells.

Way back when Margaret Thatcher was in power, Scotland was leading the world in wind power; then Thatcher went all in on gas and stopped all government support for research into wind power.

Thatcher’s short-sightedness and the UK’s eggs all in one basket approach was Denmark’s gain – the Danes quickly became the world leaders in wind energy; we now import wind turbines and expertise from Denmark.

That means even if Scotland has the best wind resource in Europe, we are little but a service station for other nations’ tech.

The other big reveal from Sunak’s flying visit has created enough spin and heat to power Scotland, but let’s cut out the political noise that’s been flying around from all sides about another auction round of oil and gas exploration licenses.

Sunak and the Tories have painted this in the North East as creating jobs and some form of Doricdonia utopia with 100 new exploration blocs of seabed open for bids. A lot of the reaction to this from non-North East voices on our own side has been unhelpful and been as off as selling a utopia.

Let’s look at the reality of this auction round. Up until recently, these auctions happened yearly; last year was the first round held since 2019. Last year’s auction had 931 blocks on offer – only 258 of these blocks received offers.

Each year a large number of blocks are handed back with zero development having been carried out. The small percentage of blocks that then see exploration wells are mostly dry wells or uneconomic to get the oil out.

According to OEUK, the current success ratio in terms of finding commercially extractable oil is around 20% per well drilled. In 2022, only six exploration wells were drilled – at the time of steady high oil and gas prices.

The problem is not a lack of blocks of seabed to explore – The North Sea basin is the most explored basin in the world in terms of oil and gas. the problem is the easy oil has all gone and the big world players are gone as well from the North Sea; the small investment companies that remain don’t have the capital to fund big new projects.

So any new discoveries that are developed will be tiebacks to existing oil rigs, and this creates very few jobs.

Plenty has been said about the fallacy of the claims that new oil and gas projects will lead to increased energy security or mean we don’t have to import oil and gas. With 80% of our oil going for export and it all sold on the open market, Sunak thinks we are all idiots.

I don’t personally buy into the “leave it in the ground” camp; oil in itself is not the problem, but burning it is the problem. Oil is the building block of our modern world with countless uses, it is the most precious of materials that future generations will hold us in utter contempt for wasting by burning while destroying our environment.

We will still likely be pulling oil out of the North Sea for decades, but the days of the oil industry being the bedrock of our economy and way of life in the North East have gone – and it’s long since time to rebalance our economy yet again.

A new future awaits; clinging to the sinking oil and gas ship will just mean we drown in decay.