Sir Alok Sharma moves an Amendment to the Offshore Petroleum Licensing Bill which would stop the invitation of new production application licences in the North Sea until there is a ban on the flaring and venting of methane by new offshore installations and prevents licensing rounds from 2030 if a wider ban on flaring and venting is not in place.
Sir Alok Sharma (Reading West) (Con)
I refer the House to my entry in the Register of Members’ Financial Interests.
On Second Reading, I said that this Bill was something of a distraction and not necessary on the basis that the North Sea Transition Authority can already grant licences annually or, indeed, whenever it considers it necessary. That will not change with the Bill. I also noted at the time that the two statutory tests in the Bill have been designed in such a way that the computer always says yes to new oil and gas licences, but I also said that I would work with other like-minded colleagues to improve the Bill and bring in further tests that need to be met before any new oil and gas production licences are granted. That is what I and other Members have sought to do.
Amendment 12 seeks to do two things. First, it would stop the invitation of new production application licences until the Secretary of State has introduced a ban on the flaring and venting of methane by new offshore installations. Secondly, it would require the Secretary of State to prevent licensing rounds from 2030 if a wider ban on flaring and venting is not in place. Along with other Members who have signed up to the amendment, I argue that this is an entirely reasonable ask that the Government and all Members should be able to get behind, given that all it modestly seeks to do is put into statute existing guidance on flaring and venting that was issued by the North Sea Transition Authority.
Let me set out the precise wording of the principles that the NSTA expects industry to follow in relation to flaring and venting across all UK continental shelf areas. First,
“flaring and venting and associated emissions should be at the lowest possible levels in the circumstances”.
Secondly, there should be
“zero routine flaring and venting for all by 2030”.
Thirdly,
“all new developments should be planned and developed on the basis of zero routine flaring and venting.”
That is a set of NSTA principles with which amendment 12 in entirely consistent.
John Redwood (Wokingham) (Con)
Can my right hon. Friend explain why it would be better to import liquefied natural gas, with four times the amount of CO2 produced, rather than have our own gas? His regulations would not apply to the foreign-produced gas we import.
Sir Alok Sharma
My right hon. Friend makes an important point: LNG has a higher carbon-intensity footprint. But the majority of the gas that we import comes by pipeline from Norway, and the production intensity of Norwegian gas is around half that of the UK’s.
John Redwood
Will my right hon. Friend give way?
Sir Alok Sharma
If I may, I will continue. In their response last year to the Environmental Audit Committee’s report on accelerating the transition from fossil fuels and securing energy supplies, the Government doubled down on the NSTA position. Responding to the EAC recommendation, which called for the banning of flaring from UK installations, the Government noted that they had already signed up to
“make every effort to ensure that routine flaring from existing oil fields ends as soon as possible, and no later than 2030.”
The Government response went on to highlight the NSTA guidance that new developments are approved on the basis of zero routine flaring and venting.
My right hon. Friend the Member for Wokingham (John Redwood) raised the issue of imported gas. I will just point out to him that, unfortunately, flaring is still a common practice in the UK. By contrast, Norway banned routine flaring in 1971, and the carbon intensity of Norwegian gas production is around half that of UK domestic production.
John Redwood
The marginal gas we would import would come from Qatar or the United States of America. There is not an infinite supply of Norwegian gas, so my right hon. Friend is missing the main point.
Sir Alok Sharma
With respect, I do not think I am missing the main point. The point that the Government are pursuing is to ensure that we have less use of fossil fuels overall and that we expand our renewable capacity, including nuclear, which I know my right hon. Friend supports. That is where we should be going with this strategy. The ban on flaring in Norway is one of the key reasons that Norway has become a leader in the cleaner production of oil and gas, which this Government have clearly indicated that they also want for UK production.
I am looking forward to hearing the Minister’s response to amendment 12. I hope he will say that, given that it is consistent with Government policy and guidance, the Government will introduce a similar amendment in the other place. If they choose not to do that, I am pretty sure that a similar amendment will be tabled in the other place anyway, and that it is likely to be supported. I would just humbly observe that if the Government whip against this or any similar amendment, either in this House or in the other place, they will put colleagues in the absurd position of effectively having to vote against existing Government policy. I am really looking forward to listening to what the Minister has to say.
The Minister for Energy Security and Net Zero (Graham Stuart)
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Turning to the amendments selected today, I first thank my right hon. Friend the Member for Reading West (Sir Alok Sharma) for amendment 12 on flaring and venting. As has been discussed, the guidance from the North Sea Transition Authority is clear that all new developments should be planned on the basis of zero routine flaring and venting. The Government have already committed to ending routine flaring and venting by 2030, going further than the World Bank’s zero routine flaring initiative. That voluntary North sea transition deal is reaping rewards. Based on the latest data, North sea flaring is down 50% since 2018, and the sector is on track to deliver the 2030 target.
I fear that the amendment would risk replacing voluntary momentum with a slower, compliance-based, more resistant approach from industry. However, I will continue to engage with my right hon. Friend as the Bill moves to the other place, with a view to delivering the end of flaring and venting by 2030 at the latest, which is an ambition he and I share, as do the Government.
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Sir Alok Sharma
I have listened intently to the Minister and I welcome his willingness to work together on the issue of flaring and venting. What I did not hear from him was the clarity that I wanted on whether Government would look to introducing an amendment similar to amendment 12 in the other place. Perhaps that is something we can discuss before the Bill returns to this House.
Graham Stuart
indicated assent.
Sir Alok Sharma
I am delighted to see the Minister nodding. I would just point out that even if the Government do not support a similar amendment in the other place, I am fairly confident that a similar amendment will be moved and I expect supported in the other place. This place will then have the opportunity to opine on that particular amendment, so I will not divide the Committee on this occasion. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.