The UK Government has announced details of a £16Bn (US$22Bn) transformation plan for the North Sea that will see the offshore oil and gas industry transition into new sectors
The North Sea Transition Deal aims to help oil and gas companies transition into renewables and help decarbonise North Sea production. The deal is the first of its kind in any G7 country.
The Deal outlines more than 50 government and industry actions to accelerate moves towards the government’s target of net-zero emissions by 2050.
Key commitments in the Deal include the sector setting targets to reduce emissions by 10% by 2025 and 25% by 2027 and committing to cut emissions by 50% by 2030.
The plan includes up to £3Bn to replace fossil fuel-based power supplies on oil and gas platforms with renewable energy, up to £3Bn on carbon capture usage and storage (CCUS) and up to £10Bn for hydrogen production.
By 2030, the sector will voluntarily commit to ensuring that 50% of its offshore decommissioning and new energy technology projects will be provided by local businesses, helping to anchor jobs to the UK.
The plan also foresees the appointment of an Industry Supply Chain Champion who will support the co-ordination of local growth and job opportunities with other sectors, such as CCUS and offshore wind.
The Deal will help to unlock investment over the next decade in low-carbon solutions including CCU and hydrogen, support the creation of up to 40,000 new energy jobs in industrial heartlands across the UK, cut UK emissions by 60M tonnes, with 15M tonnes of reductions from industry production by 2030 - the equivalent of annual emissions from 90% of the UK’s homes.
The deal also aims to boost carbon-capture infrastructure that the Committee on Climate Change said is necessary to tackle climate change, kick-start hydrogen in the UK, building a platform to provide an alternative for heating, heavy industry, and transport and ensure energy communities like Aberdeen and Teesside can successfully transition, retaining jobs and skills and creating a more diverse and inclusive workforce.
OGUK chief executive Deirdre Michie said, “The North Sea Transition Deal is a transformative partnership which will harness the expertise of the UK offshore oil and gas industry to urgently meet the country’s climate ambitions of net-zero emissions by 2050.
“It will unlock billions of pounds of investment and see government and industry work together to deliver a homegrown energy transition, realising innovative low-carbon solutions that can be exported globally.
“The Deal will safeguard UK energy security, providing affordable energy to millions of households, secure tens of thousands of jobs in industrial heartlands across the country and support the UK economy. It is the first deal of its kind by any G7 country and a striking example of the UK showing global leadership on climate change ahead of COP26.”
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