Transition from North Sea oil makes us safer, says minister

Moving away from North Sea oil and gas to renewable energy will make the UK less susceptible to economic threats from other countries, the trade secretary has said.
Jonathan Reynolds said that the impact of Russia’s invasion of Ukraine on inflation and energy bills in Britain highlighted the country’s vulnerability to shocks elsewhere in the world.
Offshore industry figures have expressed dismay at Labour’s decision to add a further three percentage points to the energy profits levy, which would take the headline tax rate to 78 per cent. The end date for the charge has also been extended for a further 12 months to March 2030.
Reynolds argued that although trade was “crucial to prosperity and to resilience … there are things that are threats that we have to manage as a government”.
He said: “We have to have more sight of them, to understand [them] as our economy is in transition, particularly around net zero, some vulnerabilities are reduced, particularly around oil and fossil fuels.”
Last month Shell disposed of 11 offshore assets and an exploration field, while a separate £900 million project was again put off.
Reynolds acknowledged that there were “difficult issues around the North Sea” but added: “What we’ve got to acknowledge, first of all, is that this transition is happening. And fundamentally for us, it’s about how to maximise, in terms of what Scotland has going for it, some of the most exciting potential opportunities for the future, and the world knows this.
“You go around the world, they know what is potentially here — and GB Energy is about maximising those things.”
An announcement about where GB Energy will be headquartered is expected in the coming weeks, with Scotland’s three largest cities believed to be fighting it out to be the host.
There is still a lack of clarity about how the public energy company will look. Reynolds said there would be imminent announcements “on how GB Energy and the national wealth fund will interact. At the core of it is public investment to leverage a much higher degree of private investment”.
Despite recent clashes over the financial troubles facing both governments, Labour and SNP ministers have largely attempted to adopt a more constructive approach between Westminster and Holyrood since the general election.
Reynolds criticised the previous Conservative administration for hostile communications with the Scottish government.
He praised Kate Forbes, the deputy first minister, for her early approach to relations between the governments but said he would have to “judge people on their actions” when asked if he could trust SNP ministers before the 2026 Holyrood election.
Last week, the Scotch whisky industry received a £25 million boost when Brazil agreed to give it protected status as part of a crackdown on bootleg products.
The national drink was previously targeted with a 25 per cent tariff on single malt by the former Trump administration during a trade dispute between the United States and the UK.
Reynolds said that “the prominence of Scottish whisky makes it potentially vulnerable”, adding: “However, take a step back and the success story is so powerful, is so brilliant and fundamentally in future, I see the trade deals that we are negotiating as being ones that will have particular benefits, potentially, for food and drink.”