30 June 2016
Aberdeen Oil & Gas Summit Update Meeting: Three layers of government meet with key industry players to look ahead
At the Aberdeen Oil and Gas Summit update meeting today (30 June 2016) industry leaders, academics, trade unions, representative bodies and three layers of government came together to provide an update on what has been achieved since the 2015 Oil & Gas Summit, what has changed, and what needs to be focused on collectively going forward.
Aberdeen City Council Leader Councillor Jenny Laing said: “The follow up summit was imperative to reiterate the importance of looking forward, combining our experience and knowledge to ensure we deliver a variety of meaningful actions which have tangible impacts.
“We had a very successful meeting today (June 30 2016), where key players of the oil industry worked together to bring forward positive actions and plans for the North East of Scotland.
“It is vital that Aberdeen City Council lead with ambition and show Aberdeen is an exciting place to live, work and visit. As we take the city on an exciting transformational journey, we endeavor to invest £516 million in a capital programme in the next five years.
“The investment will allow the city to face current challenges and prosper not only within communities but also on a global scale.
“Working in partnership we must continue to anchor the sector and supply chain to Aberdeen for the long term future.”
Tommy Campbell, Chair of the Offshore Trade unions Co-Ordinating Group said: “The offshore based Trade Unions welcome this initiative by ACC and we will work with all those concerned to protect jobs and argue for more investment from the major oil operators in the UK Continental Shelf Oil and gas industry. We are in favour of meaningful workforce engagement that will result in efficiency savings that avoids cutting pay and fundamentally changing work Rotas that lead to longer shifts that could put workers at risk of injury or death. We want morale to improve and workers safety to be upper most in everyone’s thoughts and actions. The sooner we have a major National UK oil and gas summit involving the major oil companies and other stakeholders to discuss plans for maximizing economic recovery then that will be best for all concerned. ”
Councillor Martin Kitts-Hayes, co-leader of Aberdeenshire Council said: “Working in collaboration is an essential part of restoring growth and success in the energy sector around our region. Events such as this are vital for the part they play in demonstrating to the rest of Scotland and the wider UK that we stand shoulder to shoulder.”
Andrew Dunlop UK Government Minister for Scotland said: “We know that the UK’s oil and gas industry is facing significant challenges but it’s important that we all work together to ensure a sustainable, long-term future for the industry. That’s why the UK Government is doing everything it can to support the North Sea industry to increase collaboration, improve innovation and be competitive on a global scale. No other government has supported their industry so extensively.
“We are working collaboratively with the Scottish Government and Aberdeen City and Aberdeenshire Councils to support the area through the Aberdeen city deal by providing new opportunities through innovation and technology.”
Minister for Business Innovation and Energy Paul Wheelhouse said: “The Scottish Government is totally committed to ensuring our oil and gas sector has a bright future, despite the current challenges. The summit today was positive, constructive and discussions covered a range of interests that will help us identify further practical steps we could take together, to continue to make real progress in supporting this vital industry.
“Scottish ministers are committed to supporting the North East. Delivery of the city region deal will reaffirm the North East’s global reputation in oil and gas through the new Oil and Gas Technology Centre and infrastructure investment and this will provide a sound basis for diversifying the region’s economy, building upon existing strengths in the agri-food and drink and biopharmaceuticals sectors”
Sir Ian Wood, Chairman, Opportunity North East, said: “There was a helpful update and exchange of views and ideas. There are no immediate solutions, but signs of significant improvement in a number of areas – the 40% per barrel cost reduction, the proactive effective approach of the OGA on collaboration, a significantly improved Fiscal position following the last Budget and a commitment to support the drive to developing the new OGTC in the North East of Scotland. The problem is there’s still a void. $50 oil reduces the losses but doesn’t achieve investment. There’s now an urgent focus to minimise the number of companies, both operators and supply chain, that might succumb to the serious financial pressures, and that’s a significant action point for all to consider. Sadly, the job losses will continue but hopefully at a much reduced rate. There should be some price daylight into 2017.
Deirdre Michie, Chief Executive of Oil & Gas UK, said: “Our industry has made significant progress since last year’s Oil and Gas Summit. We can’t control the oil price and that’s why we have been working hard on the areas where we can make a difference – on our own costs and efficiency. We have seen a 40% reduction in unit operating cost and our Efficiency Task Force is making real strides, gathering examples of where industry is being more efficient, such as companies sharing spares through an inventory management system. Nevertheless these are still challenging times and there is still more to do. We need to keep working with governments and regulators to urgently stimulate activity to help safeguard our world class supply chain, jobs and the skills we need for the future. While the vote to leave the European Union poses new challenges to our industry, we are resilient and capable of working together with governments to respond to them. But we cannot afford to allow attention to be diverted from what needs to be done to navigate our way through the current downturn in our sector. We urge all those involved to work constructively to make this transition as smooth as possible.”
Lena Wilson, chief executive of Scottish Enterprise and chair of the Energy Jobs Taskforce said: “Today’s oil and gas summit was a valuable opportunity to hear from key players regarding the significant amount of activity being delivered to sustain the industry’s long term future in Aberdeen. I was pleased to update the summit on the work of the Taskforce and was heartened by the strong support for our work.”
Notes and attendance details:-
− The Aberdeen Oil and Gas Summit update meeting was held on Thursday 30th June at the Aberdeen City Council, Town House.
− The itinerary for the summit was as follows:-
− Welcomes by summit chair Aberdeen City Council Leader Councillor Jenny Laing.
− UK Government perspective
Lord Andrew Dunlop, Parliamentary Under Secretary of State, Westminster Government
− Scottish Government perspective
Mr Paul Wheelhouse, Minister for Business, Innovation and Energy, Scottish Government Minister
− Opportunity North East perspective
Sir Ian Wood, Chair, Opportunity North East
− Key stakeholders update;
Progress update since the 2015 Oil & Gas Summit
o Oil & Gas UK Deirdre Michie, Chief Executive
o Oil & Gas Authority Andy Samuel, Chief Executive
o Trade Unions Tommy Campbell, Chair of the Offshore Trade unions Co-ordinating Group
o Scottish Enterprise/ Skills Development Scotland Dr Lena Wilson, Chief Executive
− Wider group discussion
− Priorities for the year ahead