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Salmond denies exaggerating oil reserve figures

ALEX Salmond has brushed aside claims the Scottish Government has exaggerated the amount of oil remaining under the North Sea.

ALEX SALMOND: The First Minister denies claims on oil.
ALEX SALMOND: The First Minister denies claims on oil.

The First Minister insisted that 24billion barrels of oil - the industry's maximum estimate - could still be recovered in the coming decades.

He faced repeated questions over the Scottish Government's economic case for independence, which is underpinned by oil forecasts above those used by the UK Government, after Sir Ian Wood said he was over- estimating potential production by 45 per cent to 60 per cent.

The Aberdeen-based oil tycoon said he expected the North Sea to produce a further 15 to 16.5billion barrels and warned dwindling output would start to hit the economy and cost jobs within 15 years.

But Mr Salmond told MSPs his figure of 24billion barrels was a "robust" industry estimate based on possible production beyond 2050.

He said: "It shows the extraordinary potential that remains in the waters around Scotland if the policies are pursued and the stewardship is correct to make sure that these resources work for the Scottish people."

His comments were backed by Aberdeen University oil economist Professor Alex Kemp.

In a statement he agreed it could be economically viable to recover 15 to 16.5 barrels by 2050 if new tax breaks for oil companies were introduced.

However, he said new technology and rising prices could "reasonably be expected" to make known but as yet untapped fields economically viable in the years beyond.

He said the prospect of 24billion barrels was "plausible".

The estimate was originally produced by industry body Oil and Gas UK, which said there were between 12 and 24 barrels of recoverable North Sea oil.

The First Minister has argued repeatedly that oil wealth would help an independent Scotland increase public spending.

In a report comparing the UK's stewardship of its North Sea reserves with Norway's, the Scottish Government again insisted it could save money into an oil fund - a prospect Sir Ian said was "unlikely" given the pressures on Scotland's public finances.

Speaking in Dumfries last night, Labour's Shadow Foreign Secretary Douglas Alexander said Sir Ian's comments were a "Black Wednesday moment" for Mr Salmond, in a reference to the calamitous time when the pound was forced out of the European Exchange Rate Mechanism in 1992.

He said: "Sir Ian Wood's comments represent the most important moment of the campaign so far.

"The growth of modern nationalism was powered by claims about North Sea oil.

"For the North Sea's foremost expert to say that the SNP are overestimating the amount of oil left by 60 per cent leaves the entire economic case for independence in ruins just days before the postal votes arrive."

He added: "Sir Ian said that he felt the need to enter the debate as he could not stand by any longer and allow our country's future to be based on hopelessly exaggerated predictions and promises that simply could not be delivered.

"It is the moment that the SNP must have dreaded."

In a symbolic vote on Holyrood's final day of business before Scots go to the polls, the SNP used its majority to pass a motion saying a Yes vote next month was "the opportunity of a lifetime to build a fairer, greener, more prosperous country for everyone who lives in Scotland" and that "Scotland should be an independent country".

Opening a debate on the referendum, the First Minister said the vote was "the first time ever the people of Scotland have had democratic control over their own destiny".

He added: "When the polls close, let's not hand that control back.

"Let's keep Scotland's future in Scotland's hands, then come together to build the better Scotland we know is possible."

Scots Labour leader Johann Lamont said the country had been "on pause" as the independence debate overshadowed discussion about improving schools and hospitals.

She added: "So I embrace the opportunity that this referendum presents, the opportunity finally to answer the constitutional question and agree among us the settled will of the people of Scotland.

"Whatever happens on September 18, Alex Salmond can claim this important legacy: that the question of Scottish independence will have been put to the Scottish people and they will have been given a fair opportunity to answer it."

Scots Conservative leader Ruth Davidson said: "The UK is ours, we built it, and to leave it would be to lose something of ourselves and to leave behind less."

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