15 June 2016

S5M-00448 Economy

The Presiding Officer (Ken Macintosh): The next item of business is a Scottish Labour Party debate on motion S5M-00448, in the name of Jackie Baillie, on the economy.

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Stewart Stevenson (Banffshire and Buchan Coast) (SNP):

As Ivan McKee adumbrated, I shall talk about the effect of the oil industry’s difficulties in the north-east.

I will respond to a couple of points before I do so. Murdo Fraser should be more cautious in praising the brevity and conciseness of the UK tax code. The UK Government itself reports that, from 759 pages in the 1965-66 tax year, the code is now 11,520 pages, and the legislation upon which it is founded constitutes 2,413 pages. That is substantially more than many other places. I recognise that Mr Fraser quoted correctly, but he needed a wider context.

On Jackie Baillie’s contribution—the member should listen up because this is unusual—I say that I found her analysis more focused and more relevant to the debate than I often do, although I am of course going to disagree with some of the conclusions that she draws. However, I encourage her to live up to the improvement in her contribution that we have heard today.

My constituency of Banffshire and Buchan Coast is home to the world’s biggest offshore oil support base at Peterhead. Many of my constituents work offshore in our own waters but they also take their expertise to many corners of the world—to South America, the Philippines and the Horn of Africa—where there is oil exploration.

Those facts go to the heart of a very important thing about the industry in the north-east and in my constituency: we have skills that have been built up over a long time that will sustain us over the long term, if we have the opportunity to use them. People have been denied the opportunity to take their skills to the new renewable energy industries that we had expected—many of which would have been offshore, where there would have been a particular relevance to the skills of the engineers and people who work offshore in the oil and gas industry. That is a particularly hurtful blow to the future economic and personal prospects of the north-east.

I disagree with Patrick: he said that this is an industry without a long-term future.

The industry is, in fact, a long-term proposition—not, as Mr Harvie says, a short-term proposition—but it may not be as fuel. We can solve the issue of using oil and gas as fuel; we have yet to make a big impression in the use of oil and gas as chemical feedstock, so it will remain an important part of the industrial environment, even as we move away from using oil and gas as fuel.

Patrick Harvie: The member makes a serious point, which I did acknowledge has a place in the argument. However, given the impact on investment in the North Sea at the moment, if this material—hydrocarbons—was able to be used only for non-fuel chemical feedstocks and not for fuel, does Mr Stevenson really think that it would be economically viable as an investment?

Stewart Stevenson: Mr Harvie is clearly listening to a different speech from the one that I gave, because I did not say that. I pointed to the long-term future because Mr Harvie said that there was none. I suggest that there is a long-term future.

A third of our oil remains, and that is only of the stocks that we have found; we are still finding oil in our sector. The Norwegians are finding oil—for example, they found some in the Johan Sverdrup field relatively recently. Opportunities will continue to be there; there will be opportunities for investment. We have seen the successes of smaller companies, which various people have referred to in the debate.

I now say a word or two about fracking, which is the last part of the Conservative motion, and why it is right that we have a moratorium on the subject. I reference the United States experience, because there is quite a lot of it. The National Institute for Occupational Health and Safety in the US talks about workers being

“regularly exposed to high levels of benzene, which is a known carcinogen”.

The institute also talks about exposure to silicosis, which is a deadly lung disease.

The BMJ talks about

“Volatile organic compounds and diesel particulate matter”

being reported by the US Environmental Protection Agency. An academic paper that was published in New Solutions talks about health conditions that

“became worse after shale gas development started”

in their area. Participants in that survey reported worsening existing conditions and new conditions in human beings, animals and household pets.

The EPA reports that there is uncertainty about how many incidents there are but says that, in Colorado, it can be as much as 12.2 spills for every 100 wells, with all the consequences that flow from that. It says that the spills reached surface water in 9 per cent of cases and contaminated soil in 64 per cent of cases.

The EPA also says that not everything is known, and I accept that. That is why a moratorium is right and why we should look further at the research to underpin a long-term decision.

The US experience tells us that we cannot proceed with shale gas in the present circumstances, but oil and gas in the north-east certainly needs support. More important, we need renewables to become the focus, and the UK Government is letting the people in my area in the north-east of Scotland seriously down in that regard.


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