Economic Report 2020

have only fallen by an estimated 10.2 per cent so far this year, while global emissions have reduced by around 5.5 per cent. These relatively small emission reductions, which resulted from significant economic and personal hardship, underline the challenge and opportunities faced by governments in delivering a sustainable recovery through lower carbon energy and industrial processes. Even during the pandemic, the sector continued to drive forward with Roadmap 2035 and its focus on ensuring that maximising economic recovery is inextricably linked with delivering net zero. Indeed, companies remain committed to reducing emissions associated with the production of oil and gas, and continue to be some of the biggest sectoral investors in offshore wind, hydrogen, carbon capture and storage solutions. In addition, industry is currently engaged in discussions with the UK Government about a North Sea Transition Deal. If successful, this would act as a catalyst to help stimulate jobs and provide energy security while transitioning to a net-zero future, in alignment with the Prime Minister’s recently published ten-point plan. The industry has already set ambitious targets to ensure it delivers significant emissions reductions from its own operations. At the same time, carbon capture, usage and storage (CCUS) and the hydrogen economy represent

important opportunities for the sector to help other industries decarbonise; they also play to our domestic supply chain’s strengths to deliver CCUS at scale. As new regulatory and business models develop our sector can provide solutions and expertise by leveraging our existing skills base and supply chain capabilities. 2020 has been a hugely challenging year and while the timeframe for the recovery of the UK’s changing offshore oil and gas industry remains uncertain, it is clear that with the right support, it can continue to earn its place in the UK’s energy future. As our Economic Report shows, there is now a clear pathway for our sector to help push forward a green recovery, create new jobs and support those in energy communities across the country, providing secure, affordable and lower-carbon energy and products.

Deirdre Michie OBE, Chief Executive, OGUK

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