ALGY Cluff has made an interesting contribution to the debate about how to stimulate activity in the North Sea, which is in the third year of the deep downturn triggered by the crude price slump.
With companies slashing exploration budgets in response, industry leaders are concerned that huge amounts of precious oil and gas may be left undeveloped in the North Sea.
Calls for the UK Government to do more to encourage firms to take the risks involved in drilling wells that may turn out to be dry have got ever louder.
But the kind of generous support provided for explorers in Norway does not come cheap.
Mr Cluff’s novel suggestion that ministers could fund an effective programme of subsidies for explorers by raiding those provided for offshore renewables developments may win support among critics of wind farms and champions of the oil and gas industry alike.
But with oil prices set to remain under pressure for years the chances of finds meeting the kind of financial criteria set by oil and gas firms are much slimmer than they were during the boom.
Against that backdrop, some might wonder whether taking money from one group of firms engaged in the energy business to pay another would be likely to generate net gains for UK plc.
There would be fears that Mr Cluff’s scheme may risk damaging an industry that is expected to become a significant driver of economic activity, not least in Scotland.
The offshore windfarm industry may have a lifespan that will be measured in centuries, during which it will play a part in efforts to tackle climate change.
Developing offshore windfarms and fine tuning the related technology will involve big upfront costs we are told private sector players would be reluctant to take on without support. But should they be?
Ministers hope the industry will outgrow the need for such help if it is provided for long enough.
Mr Cluff’s claim that many wind farms are owned by overseas firms, such as Denmark’s Dong Energy, appears to be a populist touch. However, it begs the question whether foreign oil and gas firms should get support under the programme he envisages.
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