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Sir Ian says oil industry can now focus on progress

Sir Ian Wood
Sir Ian Wood

Sir Ian Wood, whose intervention in the independence debate caused such a stir after he questioned Scottish Government figures for future oil production, said the electorate had “chosen the best of both worlds”.

The former Wood Group chairman added the decisive No vote was “in the best interests of our children and grandchildren”.

He said: “The UK Government must now deliver on their undertakings on wider devolved responsibilities to the Scottish Parliament and every effort must be made to heal the rifts from the past few months. Scotland must unite and work within the wider UK to take full advantage of the opportunities.

“In oil and gas, there are two very important and urgently needed initiatives underway – the fiscal review and the setting up of the new regulator, the Offshore Gas Authority, a key recommendation from my Maximising Economic Recovery Review.

“Our industry is currently struggling with a completely unacceptable low level of exploration and a significant number of our offshore assets potentially up for sale.

“Yesterday’s vote now allows both these vital change initiatives to be progressed and brought into play by UK Government as quickly as possible to enable us to attract more investment.

“The debate has also highlighted the impact of depletion on the oil and gas industry in the medium term and certainly areas like the north-east of Scotland must begin to take this seriously – doing everything in the meantime to maximise the economic recovery of the remaining reserves but also beginning to think about the implications of the inevitable decline of its major industry.

“Let’s hope the huge amount of energy that’s been allocated to this very passionate debate over the last two years can now be applied to make the best of Scotland’s opportunities and the additional devolved responsibilities.”

Elsewhere in the energy industry, trade body Oil and Gas UK (OGUK) said it was looking forward to working with both Holyrood and Westminster towards the “shared ambition of maximising economic recovery of the UK’s offshore oil and gas resource”.

OGUK chief executive Malcolm Webb added: “The referendum campaign rightly revealed the important role the offshore oil and gas industry plays in our economy, both in Scotland and in the rest of the United Kingdom.

“This is understandable, given this industry remains the UK’s largest corporate taxpayer and largest industrial investor and its crucial role in helping assure thousands of well-paid highly skilled jobs as well as our energy security.

“There has been a great deal of discussion about how much oil and gas resource remains to be produced from the UK continental shelf.

“Our position remains that there could be 12billion-24billion barrels of oil and gas still to recover but…pivotal challenges need to be resolved if we are to stand any chance of reaching the top half of this range.”

Shell chief executive Ben van Beurden, who previously said Scotland should stay in the UK, said the referendum outcome reduced uncertainty for businesses in the country.

Mr van Beurden added: “Shell will continue to work closely with both the UK and Scottish governments to help the industry deliver vital energy supplies through investment in the UK’s oil and gas resources.

“We look forward to continuing our proud association with Scotland.”

Graham Alexander, head of oil and gas and a partner at Aberdeen accountancy firm Johnston Carmichael, urged Edinburgh and London to work together to swiftly implement the recommendations of the Wood Review.

Mr Alexander added: “The industry must also continue to focus on cross-sector efforts to bring escalating costs under control to protect and enhance its long term prospects.”