A forecast long-term downturn in oil and gas revenues is undermined by new investment off Shetland, a North-east MSP claimed yesterday.
On Thursday, the Office for Budget Responsibility (OBR) slashed its prediction for offshore receipts in 2040 to 0.05% of UK GDP.
The findings immediately sparked a row over the SNP’s economic vision for an independent Scotland. The same day, Aberdeen-based Dana Petroleum announced a £1billion investment in two oil fields to the east of Shetland.
The company plans to bring the Barra and Harris fields on line by 2015 with a view to doubling the group’s daily output to 100,000 barrels by 2016.
North-east SNP MSP Maureen Watt said the investment disproved unionist claims an independent Scotland would be over-reliant on a fluctuating commodity.
“Dana Petroleum’s welcome announcement of a planned £1billion investment is an example of the huge investments being made in the North Sea right now, despite the scaremongering of the anti-independence coalition over notoriously-unreliable long-term predictions,” she said.
“There remains 24billion barrels of oil and gas with a wholesale value of £1.5trillion left in the North Sea. That is a huge sum and is one that clearly demonstrates the bright future the sector will continue to enjoy.”
The OBR predicted oil prices would rise from £61 ($95) a barrel in 2016 to £112 ($173) in 2040, down from last year’s forecast of a rise from £69 ($107) in 2015 to £133 ($206) in 2040.
Production as a percentage of UK GDP would be halved from its current level of 0.74% to 0.05%. This year the Treasury will raise about £11.2billion in taxes from UK oil and gas.
Under the new analysis, that would slump to £2.9billion by 2040.