An Aberdeen MP says he is “alarmed” by UK ministers’ failure to commit to a sector deal for oil and gas.
Stephen Flynn, the MP for Aberdeen South, pressed business and industry minister Nadhim Zahawi to commit to delivering a deal for the offshore industry by the end of the year.
Experts fear around 30,000 jobs could eventually be lost in the sector in the coming months as a result of the Covid-19 pandemic and the collapse of the price of oil.
Mr Flynn urged ministers to deliver a deal to support the industry in its transition away from oil and gas as soon as possible – and said delaying until autumn would be “too late”.
After calling on the Government to “give back” to the north-east through a sector deal, Mr Flynn said there was a “lack of clarity” on the issue.
He said: “Tory Ministers have previously refused to put a formal timescale on the delivery of a sector deal but with all the positive efforts being made by the sector I had hoped they could at least confirm their intention to finalise a deal by the end of the year at the latest.
“The response I received provided an astounding lack of clarity on the future of the long promised sector deal – let’s not beat about the bush, anything beyond the autumn, let alone the end of the year, will be too late.
“Hardly a week has gone by without redundancy headlines and I’ve taken every opportunity to demand this Tory Government step up to the plate.
“Last month the Scottish Government delivered £62 million of investment in the sector, now it’s time the UK Government make good on their promise of support. Having raked in over £350 billion in revenue from the industry, it’s high time that the Treasury gave back.”
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Plans are already under way to help the north-east move away from reliance on oil and gas, and an energy transition zone – a business park focusing on renewables – is planned for the area around Aberdeen’s new South Harbour.
In response to Mr Flynn, Mr Zahawi said: “It is a manifesto commitment of this Government to deliver an oil and gas sector deal.
“We are working with the sector and the Minister for Energy has been engaging constantly with the sector to make sure they can actually take the opportunities that are before them in offshore wind generation and all sorts of areas.
“Of course, hydrogen is going to be incredibly important to the energy White Paper we publish in the autumn.”
Industry body Oil and Gas UK (OGUK) said it is in discussions with the Government over a possible deal.
Stakeholder and communications director, Gareth Wynn, said: “OGUK is discussing a transformational sector deal with the UK Government. It has jobs, the supply chain and energy communities at its core and will also set out how the UK’s oil and gas industry will play its part to support a green recovery working together with Government.”