Oil and gas industry 'should be exempt from emissions trading scheme'

Written by Jim Ottewill

Businesses and contractors working within the UK oil and gas industry should be protected from the next phase of the European Union-wide carbon trading scheme, it has been argued.

With the next set of targets for the European Emissions Trading Scheme (ETS) set to come into effect in 2013, Oil and Gas UK has called on the government to pledge its support for the industry ahead of the forthcoming world climate change conference in Copenhagen.

According to the industry body's chief executive Malcolm Webb, since it is not possible to power most oil platforms or drilling equipment with green fuels, the scheme will effectively mean a tax is imposed on the industry.

This will end up hurting businesses and contractors and reducing oil output by as much as 900 million barrels over the coming years, he warned.

"Ideally, we want an exemption, although we would settle for compensation," Mr Webb told the Herald.

"If we go on neglecting the need to maximise our indigenous oil and gas resources, all that we will do is to increase our energy insecurity as a nation."

Meanwhile, delegates at the British Science festival were recently informed that the UK could become a world leader in carbon capture and storage technology, with the North Sea emerging as the CO2 sink of Europe.