Paul Wheelhouse

The oil and gas sector faces ongoing challenges to adapt operations during the global coronavirus pandemic, compounded by the crash in oil and gas prices.

Following an extraordinary meeting of the strategic leadership group this month, the first of what is hoped to become monthly meetings will take place on 7 May.

The meeting, which was convened virtually, heard directly from the sector and supply chain on the immediate impact and response to COVID-19, and the predicted medium to longer-term challenges caused by the crash in oil and gas prices.

The group, which will be chaired by energy minister Paul Wheelhouse, comprises key stakeholders including the Oil & Gas Authority, Oil & Gas UK, trades unions, offshore operators, downstream sector representatives and supply chain companies and wider industry representatives.

The Scottish Government will continue to consider what further action is required to address the impacts of the COVID-19 emergency for both individuals and employers in the oil and gas sector, liaising with the UK Government as appropriate.

Mr Wheelhouse said: “The Oil and Gas industry is a critical component of our economy and has a crucial role to play in the transition to a net zero economy. A lot of work has been going on behind the scenes to fully understand what challenges our energy sector, including renewable energy, is facing in response to COVID-19 and physical distancing measures.

“Last week, the situation became even more difficult for the oil and gas sector, specifically, as the oil price crashed even further amid a drop in domestic and global demand, alongside a current global oversupply.

“The Strategic Leadership Group, which I will convene next week, will adopt a task force approach that will initially focus on the COVID-19 response, the longer term economic response and the route map for energy transition. It will complement and reinforce work already underway, and identify any gaps in support.

“We must ensure the industry and its supply chain continue to have a sustainable future in the longer term and that it can fulfil the important role we need it to perform in the energy transition in areas such as carbon capture utilisation and storage, the hydrogen economy and developing floating offshore wind.”

He added: “Many of the key levers needed to support the sector are reserved to Westminster, and we will seek to work closely with the UK Government to ensure both governments are doing all they can to protect jobs and retain vital skills.

“This is an extremely difficult time for our business community and we recognise the need to do all we can to help key sectors recover. The First Minister has committed to look at what further steps can be taken to support our oil and gas sector, and these meetings will be a valuable part of understanding how the Scottish Government can – critically – support our workforce, and ensure the energy transition agenda continues to meet our net zero emissions ambition.”

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