Norway Warns UK Against Abandoning North Sea Energy

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Norway Warns UK Against Abandoning North Sea Energy

 

Norway’s energy minister has urged Britain not to abandon its North Sea oil and gas industry, warning that an overzealous push toward net zero could leave the UK dangerously reliant on energy imports for decades. In a pointed critique of Labour’s current energy policies, Terje Aasland told The Telegraph that Oslo remains fully committed to developing its fossil fuel resources for the long term.

 

“We want to develop [the North Sea] for the long-term, because the oil and gas industry and the service industry is really important,” said Aasland. “It saves jobs and creates a lot of value for Norwegian society. I think in the UK, the oil and gas industry has contributed in just the same way – until now.”

 

Aasland’s comments come in response to UK Energy Secretary Ed Miliband’s decision to halt all new oil and gas exploration in the North Sea, part of Labour’s bid to achieve net zero emissions by 2050. But Norway sees the situation very differently. Aasland, a trained electrician, emphasized that while Norway is investing heavily in renewables, the transition from fossil fuels will take time. In the interim, he expects Norway to continue supplying the UK with oil and gas “for many decades.”

 

Norway’s approach to fossil fuel development has allowed it to build the world’s largest sovereign wealth fund, now worth around £1.3 trillion – approximately £235,000 for every citizen. It is also one of the largest stakeholders in the North Sea, with over 7 billion barrels of proven reserves, and it holds substantial investments in the UK, including large parts of London’s Covent Garden, Regent Street and Soho.

 

 

The issue of energy security has taken on renewed urgency after widespread blackouts affected parts of Spain, Portugal, and France earlier this week. Spain’s national grid operator, Red Eléctrica, blamed a sharp drop in solar power generation. Critics, including Spanish opposition leader Alberto Núñez Feijóo, accused Prime Minister Pedro Sánchez of putting “green ideology” ahead of the country’s energy needs.

 

Back in the UK, Labour is facing internal strife over its environmental agenda. Sir Tony Blair warned this week that the current net zero policies were “doomed to fail,” a statement that added to the unease. Though he later clarified his support for Labour’s 2050 net zero goal, the incident highlighted growing tensions within the party. Downing Street has refused to confirm whether Miliband will remain in his role through the next general election.

 

Aasland was critical of the economic implications of Labour’s energy stance, including the windfall tax on oil and gas producers, which currently stands at 78 percent. Asked how such a policy would affect Norway’s energy sector, he replied, “We would have seen investments going to other places in the world.”

 

He stressed the importance of consistency in policymaking to encourage investment. “If you want to support industry for the long-term, you have to be predictable, you have to have a stable framework, and you have to work together with the industry,” he said.

 

Norway has taken steps to protect its energy industry, including introducing tax incentives during the pandemic to keep supply chains viable and encourage new development. As a result, the country’s oil and gas production remains strong. “Last year, we produced 124bn cubic metres of gas that we exported to the European market,” said Aasland. “Norwegian production is now at a peak and will stay there for three to five years.”

 

With the UK scaling back its own output, Norway has become Britain’s primary gas supplier. In the year leading up to September 2024, Britain imported 29 billion cubic metres of gas from Norway at a cost of £10 billion, with another £10 billion spent on Norwegian oil. That translates to approximately £714 per UK household. Aasland anticipates this dependency will deepen.

 

“Norway has 30 percent of the European market,” he said. “We expect more and more European countries will invest in renewable energy which we will also do in Norway, but gas will deliver the base load capacity that is really important to maintain [stability] in electric systems. I think the pipeline gas from Norway will be one of the last sources of gas that the UK stops using.”

 

  Adpated by ASEAN Now from The Telegraph  2025-05-02