I am very pleased to follow the noble Lord, Lord Howell, because we had a conversation some time ago about how, as a young Back-Bencher in the early 1980s, when the noble Lord was the Secretary of State for Energy, he advocated the gas-gathering pipeline, which would have been of great significance to people in my former constituency who at that time worked in Grangemouth. Much of the energy debate is about purpose, being not just retrospective but prospective, and looking at technological advance and the possibilities this offers to facilitate greater efficiencies and better exploitation of the resources we have. Therefore, it seems very strange that we have a piece of legislation recalibrating—we might say—the Oil and Gas Authority, and that one of its main purposes is to be retrospective rather than prospective. I back my noble friend on the Front Bench because I think that we would be missing a trick here if we simply imposed on this authority in its new form the business of conducting retrospective triennial reviews. A review of past performance is desirable. You could argue that in the first instance three years might be appropriate, but thereafter I think it would be far more appropriate to have annual reviews so that we would have an annual report and perhaps an annual debate.
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Certainly, in my days as chair of a Select Committee one of whose major responsibilities was looking at energy matters, we would have been very keen to have an annual discussion with the OGA about what it was doing and where it was going, and in preparation for such a meeting—I would not say confrontation, simply a meeting—I would have thought that the staff would carry out a review. Therefore, I think the work within the OGA probably will involve annual reviews. I am not one of those people who says that we should have them from the word go, subject to the closest scrutiny. Fledgling functions and organisations take time and sometimes mistakes are made that are not necessarily too embarrassing but you do not need to have a battle about, “We’ve got the first year wrong”. It is when you get to year three, four or five that reviews are really critical. Also, when you are dealing with reviews and you are learning lessons, you have to review not only the past performance but whether or not the authority is capable of doing the job it has been set up to do. Then matters of purpose come into play. It would be better if we were able to do that.
We have an infrastructure in the North Sea, perhaps not as logical and sophisticated as the kind that was envisaged some 30 years ago and, sadly, rejected by the then Government; nevertheless, we have this fantastic asset in the North Sea which we could be making use of in a variety of ways, which would not necessarily be only in relation to CCS. I have my misgivings about CCS. In some respects, it is beginning to become the carbon version of fusion—“It will be all right in 35 years’ time”. In fact, the experts tell us that it may be only 20 years for fusion, but one gets a little impatient with the advocates of CCS, who keep telling us it is just round the corner. I was in Australia a couple of years ago and the Australian press was confidently saying that it would be 25 years. You might
argue the Australians have an excuse for that, given their Government’s attitude towards climate change and the influence of the coal lobby there; they are quite happy to see it in the long grass. It would be good if we could get it earlier, but to put a substantial part of our money on that particular area of activity for the OGA is a wee bit overoptimistic. Therefore, I would strike a cautionary note on that.
One of the great successes of the British economy has been our ability to harness the resources of the North Sea. It has always been difficult and because of that it has always been expensive. When the price of oil and gas is high, such investment is possible, but with the price of a barrel now being no more than $53 or $54, at least into 2016, we are talking about very high risks and therefore we need to have the best information. We need to have another voice, which can give reasonable forecasts and another opinion, not necessarily from within government but at arm’s length from government. We would be missing an opportunity were we not to take advantage of this creature we are dealing with at the moment—the OGA—and giving it better-defined functions with a greater degree of ambition, rather than the rather limited, retrospective function we are endowing it with in this clause, if we do not amend it along the lines my noble friend has suggested.