The UK must act now - or we risk losing out on 95,000 highly skilled jobs and missing net zero.

I was privileged to spend time at Offshore Europe 2023 last week. It was great to see so many people from across the globe, highlighting the importance of our sector and the North Sea as a centre of excellence and innovation. There is a genuine buzz around the future opportunities not just in oil and gas but in wind, carbon capture and storage, and hydrogen.

OEUK published our 20th Economic Report at the conference: Unlocking our energy future which sets out the framework to answer one of the hugely important questions of our time. That is, how do we successfully tackle energy affordability, security and delivering on our climate goals, whilst also creating high value jobs in communities up and down the country? The answer is right here on our doorstep: leveraging our homegrown offshore energy industry and our highly skilled people.

Total offshore energy spend could reach ￡200bn this decade in oil and gas, offshore wind, carbon transport and storage and low carbon hydrogen – highlighting the opportunities we have if we can unlock this.

But about half of this total amount - ￡100 billion - is waiting on Final Investment Decisions from businesses that need renewed certainty to sign off. Projects are progressing, but not in the numbers that the UK needs to deliver secure and affordable energy, protect jobs, and deliver on our climate goals.

This is a global race for energy investment and other countries are in action. In the US, the Inflation Reduction Act is ploughing many billions into the next generation of energy infrastructure, building on its position as the world’s leading exporter of gas. In China and the EU, similar programmes have been put in place. We must not get left behind.

But there are worrying signs. The windfall tax leveraged on oil and gas production is biting. Around 90% of our oil and gas operators have cut back on their investment due to the tax. Earlier this year, we heard that Vattenfall will stop development of its huge British Norfolk Boreas offshore wind project due to rising costs. We have been warned that Britain could struggle to meet its wind targets without improved incentives.

RGU’s excellent Powering up the Workforce Report 2023 reveals our offshore energy workforce could increase by up to 50% from over 150,000 in 2023 to 225,000 by the end of the decade. That’s what could potentially happen, but this highly informative report also issues a significant warning. If we undermine investment in oil and gas, while also failing to unlock investment in renewables, then up to 95,000 potential offshore energy jobs will be at risk.

So how do we unlock this?

We must show that you can have affordable, reliable, lower carbon energy which creates jobs, grows the economy and cuts emissions. We can only do this through working collaboratively, not by setting one sector against another. This debate is not oil & gas versus renewables. We need to support both oil and gas and renewable energy. Increasingly these are the same companies and people.

There must be recognition that the people and skills in our domestic oil and gas sector have a key role to play. Their skills used to produce oil and gas over the past 50 years are exactly the skills we require to unlock the low carbon energies of the future.

Businesses need supportive and stable policy. It is essential that we create a competitive fiscal environment across the entire energy landscape that encourages investment and allows a fair return. When there is a cost-of-living crisis hitting people across the country, it is right that all sectors play their part. But when the extraordinary conditions have gone, the windfall tax must go.

To provide project developers and supply chain companies greater surety, we must streamline and align our regulatory consenting and project approval processes for projects to move forward.

The bedrock to success and delivering growth in the economy can only be in collaboration between private and public capital. Scotland and the UK mustn’t just become a good place to do energy business, it must become irresistible.

At the same time, we need to ensure that we engage with the public on the journey. The energy transition has to be done with people and not to them. By getting this right, we will grow the economy, cut emissions, support jobs and protect energy security in the UK, and for the UK.

You can read and download our 2023 Economic Report on the OEUK website here.