A new oil and gas strategy calls for a transformed supply chain to drive efficiency, innovation and internationalisation to ensure a long and vibrant future for the sector.
The Industry Leadership Group (ILG) – co-chaired by Scottish Government Business Minister Fergus Ewing and oil and gas specialist Melfort Campbell – has led the strategy refresh. The original strategy was published in 2012.
It has been developed in response to the challenging operating environment caused by the low oil price, a changing commercial and regulatory environment and a maturing North Sea basin with international competition. It aims to maximise current opportunities and:
• Further develop the vibrant oil and gas industry supply chain based in Scotland - driving forward a profitable and competitive sector both at home and supporting worldwide markets and opportunities
• Deliver a global top three position in terms of innovation and technology development, maintaining that position in the long term
• Gain worldwide recognition as having ‘centres of excellence’ in areas such as subsea, asset integrity, digital offshore and decommissioning.
Supported by Scottish Enterprise and the Energy Jobs Taskforce, the ILG developed the strategy in consultation with trade bodies, operators, contractors, SMEs and other stakeholders.
It calls for the development of the recently announced Oil and Gas Technology Centre, which promises to unite the development of technology to tackle industry challenges, and the creation of global centres of excellence to support both existing areas of strength as well as new and emerging areas.
To support the strategy, a progress report will be tabled at each meeting of the ILG setting out progress and milestones. This will cover enhanced support for the supply chain, international support for new exporting, development of the Oil and Gas Technology Centre proposal outlined in the new City Region Deal and how the oil and gas supply chain can make a significant contribution towards the need for a more cost effective model.
Energy Minister Fergus Ewing said:
“While it is clear that the oil and gas industry faces severe challenges from a low global oil price, there are still opportunities that Scotland can capture from new discoveries and through our world-class supply chain.
“The First Minister visited Aberdeen last week to announce funding of £24.5 million – part of a £400 million package of support for the North East - to boost research and development, kick-start innovation projects and help industry workers develop new skills.
“This strategy, which we committed to refresh in our most recent Programme for Government, builds on these themes, supporting the industry to maintain it global position and to drive forward the changes required to increase growth in international and supply chain sales and production efficiency. I also look forward to seeing the Oil and Gas Technology Centre develop and grow into a world class R&D hub.
“With 22 billion barrels of oil & gas remaining, the sector can still have a strong future. This will require a concerted effort from everyone – industry, governments and the Oil & Gas Authority - and this refreshed strategy sets out a clear path for all to follow.”
Fellow co-chair Melfort Campbell, said:
“Scotland’s oil and gas sector is in a completely different place than it was in 2012 when the original strategy was launched. Collaboration will be key as we focus our efforts around internationalisation and innovation as well as ensuring the supply chain is embedded in everything we do and its technology and capability not only enables optimisation of value from UK production but also maximises the international opportunities to ensure the long-term success of the sector in Scotland.”
Scottish Enterprise Chief Executive and Energy Jobs Taskforce Chair Lena Wilson said:
“Continued investment in Scotland’s oil and gas sector will ensure it remains competitive and attractive for decades to come. We will continue to work with the supply chain to deliver the transformational change required to reduce cost, improve efficiency and increase international competitiveness. By capitalising on our strengths, strong leadership and working even closer together I am confident we will come out of this difficult period stronger more resilient than ever before.”