Prime Minister Boris Johnson gave his backing to the North Sea oil and gas industry, in a roundtable with energy leaders today to discuss UK energy security.
Johnson described domestic fossil fuel sites in the North Sea as a “key asset” in the country’s plans for achieving “greater energy independence” and “ensuring a smooth transition to net zero.”
Energy groups at the event included the Oil and Gas Authority, BP, Equinor, Esso, Offshore Energies UK, TotalEnergies and Shell among others.
Business Secretary Kwasi Kwarteng also attended the roundtable alongside several other senior ministers.
Last week, the UK announced it would phase out imports of Russian oil over the course of this year, making domestic energy sources increasingly important to ensuring supply security.
The UK only depends on Russia for around four per cent of its natural gas, and while its supplies are stable, fears of shortages and disruption worldwide following the invasion of Ukraine has seen prices spike to record highs.
Domestic wholesale prices spiked to an eye-watering £8 per therm earlier this month – with costs remaining elevated at £2.68.
For context – prices for wholesale gas were at 44 pence per therm last March.
The Prime Minister and chief executives discussed increasing investment in the North Sea oil and gas industry and boosting supply of domestic gas, including “how the UK can remove barriers facing investors and developers” so that projects could “come online more quickly”.
Last week in the House of Commons, Kwarteng called for further North Sea exploration to enhance the UK’s energy independence, boost supplies and potentially ease pressure on a cost of living crisis.
The lethal combination of soaring wholesale costs and the consumer price cap has seen 29 suppliers exit the market, with Bulb Energy end up in de-facto nationalisation, propped up by potentially as much as £3bn in public money.
Industry carnage has also seen the price cap hiked to nearly £2,000 per year from April – with conflict in Russia raising the prospect of a potential further 50 per cent spike in October.
The roundtable is part of a series of engagements with the energy sector – with Downing Street set to host roundtables with nuclear and renewable companies over the coming days and weeks.
It also comes ahead of the publication of the UK’s plans for greater energy security this month, with renewable energy, nuclear and domestic gas all a crucial part of achieving its aims.