Hypocrisy accusations as UK govt minister admits oil production set to grow

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  By a Newsnet reporter  

The anti-independence No campaign are facing accusations of hypocrisy after Westminster Government ministers visited Aberdeen to talk up the growing boom in the North Sea oil and gas industry and Business Secretary Vince Cable admitted that the oil would belong to an independent Scotland.

No campaign politicians have repeatedly tried to play down the growth that is taking place in the sector and underplay the potential impact that Scotland having control over its own resources could have as well as playing on fears that an independent Scotland would not gain control of the oil resources.

However, their stance has suffered a significant blow today as Vince Cable conceded in an interview on Good Morning Scotland that “Oil and Gas UK expect production to expand”.  In a separate interview, the Business Secretary also admitted that the oil resources are found in waters which would be Scotland’s in the event of independence.

Speaking to Good Morning Scotland the Business Secretary stated: “I think that in past there’s been a little bit of an assumption that it had been taken for granted. Also a belief that it was declining, and it isn’t declining it’s got great prospects.”

Mr Cable’s comments were backed up by Oil and Gas UK Chief Executive Malcolm Webb who said:

“Record investment is forecast this year to search for and produce UK oil and gas reserves. This will be followed by an upturn in production from 2014, sustaining growth across the supply chain and reinforcing the industry’s already significant contribution to the UK economy.”

Meanwhile in an interview with BBC Radio 5 Live, the Business Secretary admitted that a large majority of the oil resources lie in Scottish waters.  Mr Cable said North Sea oil “happens to be in what are called Scottish waters” and added:

“I was in Scotland two weeks ago when the Shetland Islanders claimed that it was their oil, rather than Scottish oil.

“So we can get into an argument about what belongs to whom, but the simple fact of the matter is that if Scotland did opt to become independent they would have a major resource.”

Mr Cable’s comments are believed to be the first public admission by a UK government minister that the oil would indeed belong to Scotland in the event of Scottish independence.  The UK government has until now chosen to obfuscate the issue.

Speaking after Mr Cable’s comments, a spokesperson for the UK Department of Energy maintained that the oil was in “UK waters” and said:

“The UK government is not making plans to break up the UK. The split of any assets, including oil and gas, and liabilities would be a matter for negotiation between Scotland and the rest of the UK after the referendum, if the people of Scotland vote for independence.”  

The Scottish government maintains that some 90% of the UK sector’s oil resources would belong to an independent Scotland.  This is supported by observations from independent experts and academics.

Professor Alexander Kemp, of the University of Aberdeen, said the starting point for negotiations would be the “median line”, which has been used to draw North Sea borders between the UK and other countries including Denmark, Germany and Holland.  Using this internationally agreed standard, the vast majority of North Sea reserves would belong to Scotland.  

Thursday’s visit by UK government ministers to Aberdeen came as BP announced a £330 million programme of investment in oil exploration in the seas to the west of Shetland, underlining the fact that the industry itself is anticipating significant growth.  The Clair field has been described as a “monster” holding an estimated eight billion barrels of oil.

Last month trade body Oil & Gas UK said firms were planning investments totaling around £100 billion on the United Kingdom Continental Shelf (UKCS). It is expected to rise to a record £14 billion in 2013, up from £11.4 billion in 2012.

Commenting, SNP MSP Maureen Watt who previously worked in the oil and gas sector said:

“This is deeply damaging for anti-independence politicians who have made talking down the North Sea oil & gas sector one of the key planks of their scaremongering campaign.

“How can the No camp square their relentlessly gloomy outlook with the predictions of growth and investment being made by Westminster Government ministers? It smacks of hypocrisy for Vince Cable to talk up the oil and gas sector when addressing the industry and to trash its prospects when talking to voters.

“The soundest possible advice when looking at the oil and gas industry is to look at what the sector itself is anticipating and the massive investments that are being made in the North Sea, such as the £330 million that has just been announced by BP.

“That investment is not made on a whim, it is taking place because the industry is growing and anticipating increased production.

“These are extremely bright times for the North Sea oil and gas sector and instead of these resources once again being squandered by Westminster, it is essential that they are put to work on behalf of people in Scotland.

“With a Yes vote in September 2014 we can use our resources to build a fairer, more prosperous Scotland and ensure that the benefits of oil and gas are felt in Scotland for generations to come.”

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