Oil and gas exports 'grow steadily'

Apr 30 2012

Scotland's oil and gas exports have seen "steady" but "unspectacular" growth, according to research.

The latest survey of international activity in 2010, published by Scottish Enterprise and the Scottish Council for Development and Industry, found "ongoing, albeit patchy, recovery".

International sales stood at £7.6 billion, accounting for a record 46.4% of total Scottish supply chain sales, compared with 31% in 2002. The 2010 results are "a positive reflection" of overall performance amid a "sluggish global economic recovery".

However, the report found an "uneven" performance with overseas subsidiaries, largely autonomous operations which are owned by foreign companies but report back to a Scottish headquarters, performing much better than direct Scottish exports. Subsidiary sales increased by 10.9% while direct exports declined by 7.8%.

International markets have been "driving growth overall" and it is "only a matter of time before total international sales from Scotland's supply chain exceed that of domestic UKCS (UK continental shelf) sales".

The release of the survey coincides with the latest Offshore Technology Conference in Texas which will be attended by nearly 50 Scottish companies, exploring potential global business. The conference is attended by 70,000 delegates and 2,000 exhibiting companies.

Scottish Council for Development and Industry regional director Ian Armstrong said: "The latest survey results back up the anecdotal perception that Scotland's oil and gas sector has weathered the global downturn relatively well."

Scottish Enterprise chief executive Lena Wilson, who is attending the conference, said: "These results show the huge importance oil and gas continues to play in Scotland and, in particular, how our skills and expertise in this area are in increasing demand worldwide. The steady growth in sales at a time of a global economic downturn is particularly encouraging."

Energy Minister Fergus Ewing said: "With more than half of the value of the North Sea's oil and gas reserves yet to be extracted, these results highlight the fact that oil and gas remain an enormous economic resource for Scotland's long-term benefit. Continued and sustained investment is needed in order to maximise recovery of the remaining 24 billion barrels, with a wholesale value of £1.5 trillion.

"We will shortly launch a new strategy developed by our oil and gas leadership group. By working together within a stable, supportive tax regime to develop Scotland's rich natural resources, we will continue to be the energy powerhouse of Europe. And with the powers of an independent nation, we can ensure that the next four decades of oil and gas production in Scotland yield even greater benefits than the last four decades."