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Exactly, romaron. To a very large degree the boot is now on the other foot. The oil and gas companies cannot/will not invest without fiscal changes and the 2 main political parties giving appropriate assurances/guarantees going well into the future.

Now needs a change to the fiscal conditions and for Labour to confirm they would honour those changes too.

Taverham, even with Gary Smith and others on his case Starmer is going to find it nigh on impossible to wind back from his position of no new licences. How could he justify such a U-turn? With what new info or event? He is in a corner, tho, he has said something like we need to continue extracting as much as we can from existing fields. More still needs to done to inform/educate the public on the on-going need for hydrocarbons, that it’s something of a make or buy decision not whether it’s needed or not. Once the public is on-board, albeit maybe somewhat reluctantly, regarding the requirement and that best the UK produces as much as possible of its requirement, the next thing to focus in on is that due to the fiscal conditions the “giants” don’t want to invest to produce more and the independents can’t invest to produce more. Once that understanding is clearly in the national consciousness it will be the time for Hunt to announce some fiscal changes and Starmer to announce Labour would not roll those changes back or significantly alter the fiscal conditions. The industry needs to make it clear: no fiscal changes and no Labour announcement = little to no new investment = sharp UK production declines and job and skill losses. After a fiscal change and Labour announcement and well before the next election add also some new licences being awarded and Starmer is off the hook as he will not have to do a U-turn, the GMB and Unite will be appeased, and new production will flow from both existing fields and new ones. Easy-peasy :) :) :)

Well said, romaron.

Jeffrey, I am a LTS with a holding in 7 figures and currently well underwater. I post to reciprocate for the info, insight, numbers etc others provide, with hope I can also add to the debate and the desire to have at least the feeling I have some agency. Maybe also to be part of a community and have a support group :) This is a good and useful BB.

Considering worker's and related communities and the requirement for investment is clearly fine, but I am not so keen on the third of Unite's 3 things of the "worker's transition plan". The Conservatives with the EPL have already gone a long way to nationalising the NS part of the energy industry, without appropriate compensation for the effective expropriation . You can't always get what you want, and Unite should be happy to get something like half of what they want; worker's and communities adequately considered (but not necessarily "front and centre") and substantial investment.

“A workers’ transition plan for the North Sea must involve three things. First, it needs to put workers in the industry, and their communities, front and centre. It must be carried out with their full involvement, and guarantee decent jobs for all involved with no loss of pay and conditions.

“Second, it will require substantial investment. We have yet to see Labour, or any political party, commit to the serious amounts that will be needed.

“Finally, to ensure a just transition actually happens, we are calling for public ownership and democratic control of the energy industry. We cannot trust the private sector, whose only concern is squeezing every last drop of profit out of the UK’s remaining oil and gas reserves, to deliver for workers and communities.

The NS Oil producers need to let others, as they are more and more now, explain why NS production is better than imports, and thereby make the “indirect sale” for the NS producers. The producers, instead, need to go on the offensive to get the narrative out there and understood that without changes to the fiscal conditions the discussion about new licences or not is a moot point. This is because without changes to the EPL they cannot (and will not) make the investment. The Independents then need to add to this general narrative to show that they are the ones most important for the NS and the ones most impacted by the EPL. The Independents need PR to change them from being portrayed as the villains of the situation to the national treasures they are..

(Yes, Tommo, Tony Craven is doing his bit – a similar narrative needs to be co-ordinated across the industry.)

P.S. We all, me included, keep falling in the Troll's trap by making comments with the Troll's original "Subject "heading at the top. Doing this spreads the Troll message.

Oops, the JST oil financial backer, Labour party donor, and owner of Ecotricity is Dale (not David) Vince.

Modestus, and another (Ross Clark) candidate for champion of our cause. They are popping up like mushrooms, and a varied bunch they are. In the left corner we have JSO with Dale Vince as the trainer, and in the right corner the GMB with Gary Smith as the trainer.

Sekforde, you have a point, but apart from the direct tax raid I worry about the EPL also because it has wiped off some 35% of the value of EnQuest's reserves and limited the ability to borrow.

Kraken, David Vince, the donator to Labour you just referred to, is not just a Just Stop Oil activist. He also bank-rolls JSO and... owns Ecotricity https://www.ecotricity.co.uk/. Conflicts of interest? He just said is Labour win the next election then there is no need for JSO to exist.

In the cage you go, TerryMC1.

Another potential champion for our cause: https://dailysceptic.org/2023/05/26/not-dark-yet-but-its-getting-there/

Given the role "Frosty" (one can only imagine how it peeved him to be called that by The Johnson) had with Brexit he's not a favourite of mine, but it is irrational not to support a person's view on one matter because you disagree with them on another. Maybe he and Gary Smith could form an alliance to create the national debate that is needed on the UK's energy policy and the NS's role in that. Now that would be interesting.

But... without a change to the fiscal conditions and long-term assurances, why would companies risk investing. It feels like reality is hitting and the tables could be turning.

Could Gary Smith be the person to lead such a campaign? At first thought the leader of the GMB seems a strange position for such a task, but on reflection his could be just the right position/platform.

"The leader of the GMB union, one of Labour’s biggest donors, has called on party leader Keir Starmer to scrap plans to ban all new fossil fuel mining licenses in the North Sea.

Gary Smith said there is a “national security imperative” to keep Britain’s oil and gas industry alive as the country will continue to use these fuels for decades to come, even as part of its 2050 “net zero” target.

“It would be self-destructive not to maximize production from our own oil and gas and that’s going to be a tough debate but we have to face it,” the GMB general secretary said in an interview with the Financial Times."

Smith said that “strangling” the North Sea oil industry would be “bad for jobs” and “harmful for the environment” as the UK would still have to import gas and oil from overseas with a higher carbon footprint.

“It’s about ethics; Are we going to keep funding these regimes in the Middle East and countries like Russia, or are we taking responsibility for our own carbon and creating jobs and investment here?” he said.

Smith also argued that the big oil and gas companies could be “vital” for investing in renewable energy projects going forward.

“There’s no point in stalling the industry. We need to work with industry to encourage investment in the green technologies of the future,” he said.

Agreed, 3dartfinish, with your 2305 post. The point I am making is that the NS producers need to go on the offensive by “shouting” and make this explicit and clear, being that the fiscal environment means they cannot, and will not, invest in new fields, They need to explicitly tell the Tories that approving licences without changes to the fiscal situation is next to pointless, and tell Labour that, equally, their policy of no new licences is therefore also meaningless, and that their rhetoric of attacking and demonising the NS Independent producers and inaccurately portraying them as “war windfall” beneficiaries, almost as if somehow collaborators of Putin, is not appreciated and highly distasteful.

The consequences of no investment in new fields, and little in existing, needs to be spelled out crystal clear to the parties. They need to be asked if the public understands this and this is what they want.

The differences between the “Oil giants” and the NS “Independents” in terms of their activities, roles, financing (access to credit, hedging) and fiscal contributions to the UK, needs to be made clear. This should be done in a way not to drive a wedge between “Oil giants” and “Independents” but to highlight the crucial and critical role played by the latter’s contribution to the UK’s National Security and economy.

The Tories also need to be told that through the EPL they have effectively nationalised the NS, and Labour told private investments are not the government’s property (“Labour would continue to use existing oil and gas wells over the coming decades”) and insinuating they are government property will scare away investment not just in this sector. Both parties need to be told “careful what you wish for”, due to either their fiscal policy (Cons) or direct policy (Lab). Both need to be told words alone would now not be enough to revive the possibility of investment in new fields in the NS and anything but a minimum in existing fields.

Would the Independents agree with this? Would Equinor agree? Who could lead such a campaign?

Last line of previous post should read:

AB must know better than all of us and it starts to feel like he may now have come to the conclusion that given the changes in the fiscal and political environment this is the way it has to work i.e. a managed run-down and exit from the NS.

Maybe the NS producers need to also go on the offensive and turn the tables by saying they cannot (won’t) make investments in the UK in new fields unless the fiscal conditions are modified and assurances (signed agreements) received from both main political parties that the fiscal situation will not deteriorate for the anticipated and agreed life-cycle of the investment. Play hardball, saying the unprecedented attack on them requires unprecedented agreements, and force the two main parties into a sort of coalition on NS energy to agree a policy in the interests of National Security and economic growth. A National Debate is needed on this matter and would include romaron’s suggested “'exposé' on how the 'oil giants' escaped the windfall tax and are not really part of the NS O&G industry”, together with highlighting the windfall tax being paid by the Independent NS producers. who are being taxed into NS oblivion rather than treated as the national treasures they are. It won’t happen, fiscal changes and binding forward-agreements, then… investment won’t happen. The producers might as well bow out of the NS as lions rather than sheep, cause if nothing changes they are going to bow out anyway.

OK, the NS producers have already said this, no new investments, in a fairly passive and unchallenging way by their statements and some decisions, but they could state it actively and more assertively. They could also say they can’t (won’t) invest in anything specific and major transition/renewable/CCUS/ related unless it makes economic sense for them and they again have assurances that the rules of the game, fiscal policy, subsidies, whatever, won’t significantly change for a period of… 15 years. And if they can’t invest in new hydrocarbon productions, the conditions for transition/renewables/CCUS etc investment will need to be all the more attractive.

It would be interesting to see if Rosebank is approved, but Equinor then make a negative FID. (It’s probably agreed in advance that if a licence is awarded the company would proceed, and the hope remains that a precursor for the Rosebank would be a change to the EPL, but given Labour’s rhetoric on new licences Equinor could decide to walk-away anyway.)

For EnQuest, the idea of a managed decline of their NS resources, as romaron and others have suggested, seems to be the way to go. Use up the tax credits soonest, maybe with some growth from existing, or even contiguous, fields and/or production acquisition, but only if the economic case stacks up. As said, any switch to UK-based “renewables” and/or CCUS activity would also need to make economic sense and come with assurances of stability. A suitable merger opportunity is not incompatible with this approach. AB must know better than all of us and starts to feel like he may now have come to the conclusion that given the changes in the fiscal and political environment this is the way it now has to work i.e. a managed run-do

The Conservatives now have no choice but to go on the offensive. They need to challenge and correct Labour’s flawed and false narrative. Whether the public will listen and agree with the Conservatives is to be seen, but letting Labour’s view on energy rule uncontested would make the party look weak, ineffectual, and worse.

Two articles from today’s Sunday Times:

Starmer plans to block all new North Sea oil and gas developments.

https://www.thetimes.co.uk/article/97240c64-fca1-11ed-aa31-73394e195d29?shareToken=9073137419a01f0f18a6673b6159be40

One day we can turn off the North Sea gas taps, but not yet.

https://www.thetimes.co.uk/article/4841d6c8-fcb8-11ed-aa31-73394e195d29?shareToken=dd8cc5f3ba257fcb01faa59e167c5293

Https://www.bbc.co.uk/news/uk-65730950

In an interview with the BBC's economics editor Faisal Islam for Newscast, Ms Reeves said: "There needs to be a proper windfall tax on the huge profits the energy giants are making, because while they make huge profits, people are paying huge bills. "Those are the windfalls of war, they should be taxed properly, to help people with a cost-of-living crisis," she added.

Rachel Reaves needs to called out for playing with people by misinforming them about “War profits” made from UK oil and gas production and asked to define an “energy giant” and provide the detail on how Labour would place “a proper windfall tax on the huge profits the energy giants are making”.

RR added, "Those are not profits because of the great ingenuity of the companies... “, again she needs to be called out and have it explained that oil and gas investment is long-term and cyclical and if the return is not possible then the risk won’t be taken. The temporary spike in prices due to the war is more or less balanced by the price dip due to the pandemic.

She knows, of course, all these things, but chooses this narrative hoping for political gain. And who will pay if the public buy into this… the public, especially those with less..

The Conservatives need to go on the offensive and explain things, as letting Labour’s narrative reign unopposed will, drip, drip, drip, get into the national consciousness and this way hurt the Conservatives more. This probably is where we can best put our efforts; to pressurise the government to take the initiative on the narrative and explain things as they are.

The UK oil and gas Independents, who also benefitted less from the price spike due to hedging obligations in turn due to funding requirements (and size-related prudence), should actually be treasured and assisted as they are helping provide energy security, jobs, transition-relevant skills, tax revenues, and lower carbon emissions compared with imports (those imports to replace lost UK production due to reduced investment following the EPL).