The UK risks accelerating the decline of the oil and gas industry despite the industry's overwhelming belief that the basin could still have a long-term future, a report warns.
The Aberdeen and Grampian Chamber of Commerce paper found that 93% of businesses surveyed agreed there is still a future for the North Sea if the right economic conditions are created.
The 43rd Energy Transition report said confidence in the fossil fuel industry is weak due to financial instability, delays in planning, transmission charging and slow project approvals, rather than a lack of opportunities or capacity in the sector.
He said companies had repeatedly warned that investments were going abroad due to the country's poor economic and regulatory policies.
Some 67% of respondents believed that planning decisions on major terrestrial network infrastructure should be made by the Scottish Government, rather than local authorities.
And 89% support new licenses and consents where operators can demonstrate lower emissions than imported alternatives and deliver greater economic value in the UK.
The report warns of a “growing transition gap”, leading to infrastructure delays and uncertainty around government policy.
It made a number of recommendations, including consenting for the Jackdaw and Rosebank oilfields, replacing the Energy Profits Tax with an oil and gas pricing mechanism, and faster planning consent.
The Aberdeen and Grampian Chamber of Commerce said the findings showed the urgent need for a more competitive and stable policy environment if the UK is to retain the workforce and industrial capacity needed to deliver energy security and net zero emissions.
Chief executive Russell Borthwick said: “For several years now, the dominant political narrative has increasingly suggested that the future of the North Sea is already decided. This report tells a very different story.
“The vast majority of companies operating in the energy sector still believe there is a future for the basin if the UK creates the right fiscal and regulatory conditions to support it.
“What companies are questioning is not the capacity of the North Sea, but whether the UK remains competitive enough to attract the investment needed to achieve that future.”
Borthwick said the North Sea remains “one of the UK's greatest industrial assets” and said the same workforce that built up the sector over the past five decades would also be “critical to delivering offshore wind, carbon capture, electrification and wider transition infrastructure”.
He said: “But investment follows stability, and right now too many businesses believe the UK is losing ground to international competitors who offer clearer policies, quicker consents and more predictable long-term terms.
“The message from the industry is increasingly clear: you cannot achieve energy security, economic growth and energy transition while hollowing out the industrial base necessary to achieve all three.”
A spokesperson for the Department of Energy Security and Net Zero said: “Oil and gas production will be with us for decades to come, and we will manage existing fields for their entire lifespan, while actively expanding clean energy industries in the North Sea.
“Our ambitious plans will make the North Sea a clean energy powerhouse and generate up to 40,000 new jobs in Scotland by 2030.”
A Scottish Government spokesperson said: “Decisions around consent for offshore oil and gas projects, as well as those relating to licensing and the associated tax regime, are matters currently reserved for the UK Government.
“We continue to call on the UK Government to approach decisions regarding North Sea oil and gas projects on a rigorous evidence-based, case-by-case basis, with climate compatibility and energy security as key considerations.”
