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Neil Pooran & Ben Hatton & Peter A Walker

North east economy 'will not decline' as oil and gas production falls – Matheson

The Energy Secretary has denied there will be an economic decline in the north east of Scotland as oil and gas production falls.

Michael Matheson was speaking after the launch of his new energy strategy, which set out the Scottish Government’s goal of expanding renewable energy as oil and gas production in the North Sea is expected to “effectively end” in the next 20 years.

He said the government is consulting on whether there should be a presumption against new drilling.

Speaking to journalists on Wednesday, Matheson was asked if the north east is set for economic decline.

He replied “no”, and added: “There is going to be a decline, a significant decline, over the course of the next 20 years in oil and gas output within the North Sea.

“That’s just the facts of the situation, the danger is that if we don’t manage that transition properly, we create the same economic difficulties that were created in the 80s, when we saw the closure of coal mines and the damage that caused for many generations.

“The critical thing is about managing that process, and making sure we ramp up the speed at which we deploy renewables in order to provide that alternative employment opportunity.”

The minister also said he disagrees with comments from Aberdeen’s Chamber of Commerce that his strategy represents a “betrayal” of North Sea workers.

The strategy stated that 77,000 jobs in low-carbon energy are expected to be created by 2050 in Scotland, up from around 19,000 in 2019.

Offshore licensing is reserved to the UK Government, but Matheson said the Scottish Government has policy levers around renewables and reducing demand.

Matheson was also asked if SNP Westminster leader Stephen Flynn - the MP for Aberdeen South - had been shown the strategy ahead of publication.

The minister said he had “engaged with the Westminster group” on the strategy.

Meanwhile, Prime Minister Rishi Sunak offered his “wholehearted support” to the Scottish oil and gas industry and accused the SNP of not doing the same.

He was speaking at Prime Minister’s Questions and responding to MP and Scottish Tory leader Douglas Ross, who said the SNP’s plans were “naive and reckless”.

The Scottish Government said its draft plan “supports the fastest possible just transition for the oil and gas sector in order to secure a bright future for a revitalised North Sea energy sector focused on renewables”.

When it was published, First Minister Nicola Sturgeon said: “In this decade, we must set Scotland on the path to an energy system that meets the challenges of becoming a net zero nation by 2045, that supplies safe, secure and affordable energy for all and that generates economic opportunity through a just transition.”

Speaking in the Commons at PMQs, Ross said: “Yesterday Nicola Sturgeon’s SNP Government published plans calling for as fast as possible shutdown of the industry and an end to new exploration.

“These plans are naive and reckless, and were previously described by (an) SNP leader in this House as crazy.”

Sunak said: “We know that we will have to rely on hydrocarbons for decades to come as we transition to net zero.

“Consuming oil and gas from the North Sea means less than half the carbon footprint of importing that same oil and gas, which obviously makes sense to do it here and in the process support tens of thousands of jobs in Scotland.

“I can reassure him that the Scottish oil and gas industry has this government’s wholehearted support.”

Earlier in the session, Sunak had said the SNP “don’t want to support the Scottish energy industry”.

He was responding to SNP Westminster leader Stephen Flynn, who said Scotland’s membership of the UK union “simply doesn’t add up”.

Flynn said: “The longest and deepest recession in the entire G7, Brexit, 13 years of Tory rule, the energy price crisis, inflation and interest rates.

“If the people of Scotland are to do the maths as the Prime Minister so hopes, will they not come to the conclusion that this union simply doesn’t add up?”

Sunak replied: “Energy – and when it comes to the economy is incredibly important to Scotland’s energy, and actually Scotland will play a fantastic part in helping us transition to net zero.

“What we do now know is that the Scottish Government don’t want to support the Scottish energy industry and the 200,000 jobs that it produces.

“I’m keen to work with the Scottish Government to support the North Sea because it’s something that we’re all very proud of in the UK.”

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