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North Sea Gas Supplies

Volume 722: debated on Tuesday 21 December 1965

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The following Question stood upon the Order Paper:

71. Mr. VARLEY: To ask the Minister of Power, in the light of the British Petroleum Company's recent test of its natural gas well in the North Sea, whether he expects that gas from this field will be available for use in Great Britain; and, when, and in what quantities, it will be so available.

With your permission, Mr. Speaker, I will now answer Question No. 71.

British Petroleum are now satisfied that gas will be available from the field in Block No. 48/6 in the North Sea in quantities which should justify piping it to the land. Terms and conditions of supply are under discussion between British Petroleum and the Gas Council. It is now thought that, if all goes well, it should be possible to deliver at least 50 million cubic feet a day onshore by 1967–68.

Is my right hon. Friend aware that this Answer will be welcomed in the country? As a result of his Answer, will the individual fuel forecast—as set out in the White Paper on fuel, published in October—now need to be revised?

Not necessarily. The quantities which I have just announced are equivalent to roughly half a million tons of coal a year, or 5 per cent. of current consumption of town gas. Production could eventually, of course, exceed 50 million cubic feet a day, but the full extent of the field will not be known until more exploration wells have been drilled.

Would the right hon. Gentleman not acknowledge that the fact that he is able now to make this very welcome announcement is largely due to the speed with which the previous Administration acted? Perhaps he would call the attention of his right hon. Friend the First Secretary of State to this announcement, in view of the wild and extravagant attacks which the right hon. Gentleman made at that time. Would he not agree that it is now of urgent importance that an agreement be reached without unnecessary procedural delays between B.P. and the Gas Council, that neither should drag its feet?

I agree thoroughly on the second point. Discussions between B.P. and the Gas Council are now taking place. On the first point, I do not think that the previous Government held us back too greatly. As this is the festive season, I will grant that they did not hold us back more than a couple of days anyway. In fact, there has been a great deal of constructive work by my Department in the last 14 months and we believe that it is as a result of that work, which has progressed since the days when the hon. Gentleman was there, that this announcement is now possible. I agree with him that this is an announcement of a date for delivery far in advance of anything previously contemplated.

Would the right hon. Gentleman tell us what savings there will be to our balance of payments when the well comes into full operation? Could he draw any conclusions about the extent of the field as a whole from this one success?

We cannot know the extent of the whole field, though we are hopeful of the position. I cannot give an estimate of the saving on balance of payments, but this is, of course, an enormously important development, given the fact that B.P. has as yet drilled only one well. It will drill more exploratory wells and we are not unhopeful of the consequences.

Is my right hon. Friend aware that miners will naturally ask whether this development will not mean more pit closures? Should this not result in a speeding-up in the provision of alternative industries in the mining areas where there is likely to be unemployment?

My hon. Friend knows that there is a great drive now to provide alternative employment in the mining areas. I would not be so pessimistic as he is in saying that this will mean more pit closures. I do not think that it will. The quantities which I have announced would be equivalent to half a million tons of coal and I would not think that this would necessarily displace coal.

In view of this important announcement, will prices come down when the thing comes into operation?

I am not unhopeful that, in the fullness of time, that will result. In the immediate future, the point which the hon. Member for Orpington (Mr. Lubbock) made, of the saving on the balance of payments, is a very important consideration.

Is my right hon. Friend aware that this important announcement is of very great value to north-east Scotland? Will he say what provisions there are in the licences which he has granted to drill for oil in the North Sea for the holders to account to him and the nation for the amount of oil and the profits from it?

Of course, the profits are considerable and on previous occasions I announced precisely what they were. I hope that the House is not afraid of a surfeit of riches. We are making a most remarkable indigenous fuel available to the British people and I hope that hon. Gentlemen, even on that side of the House, will not take a narrow approach to what is a very important discovery.

On a point of order. Although the Minister said that he was answering Question No. 71 on the Order Paper, in fact he made a statement. Ought not the right hon. Gentleman to have given a copy to his opposite number?

What happened is what has happened before, many times in the recollection of the hon. Gentleman as well as of anybody else. From time to time a Minister wishes to answer a Question on the Order Paper which, in the ordinary course of events, would not be reached. I would not have thought that in such cases there was any question of the Minister supplying his opposite number with a copy. This, however, is a matter between them and certainly not for me.

Further to that point of order. I understood the Government Chief Whip to move the Adjournment of the House, and I understood you, Mr. Speaker, to say that you had not had notice that Question No. 71 would be answered. All I am saying is that I trust that it will not be a precedent that a Minister can stand up to make such a speech without giving notice.

I am surprised that the hon. Gentleman did not appreciate what took place. I thought that the House had been rather generous. There was an error in communications somewhere and in the circumstances I allowed the Question. It is certainly not a precedent.