Sturgeon faces backlash after Shell pulls out of North Sea oilfield

Nicola Sturgeon is facing a backlash over her stance on the Cambo oilfield after Shell pulled out of the project and business leaders warned that jobs were being put at risk.

Scotland’s first minister made a U-turn on her position last month, saying that she did not want to see the project proceed.

Last night it emerged that Shell, the oil giant, was no longer participating in the development. The move could spell the end for oil production in the UK. However, Siccar Point, which owns the majority of the Cambo field, says that it intends to press on.

This morning Sir Ian Wood, one of the UK oil and gas industry’s most respected leaders, urged politicians “to reflect carefully on their public statements” and the impact they had on investment in the industry.

He said: “We must not create an adverse investment environment at this crucial moment in our energy transition journey. The future prosperity of our region and the country’s ability to meet net zero depends on it.

“It has been made patently clear for some time we cannot put ourselves in the position of reducing domestic production only to increase carbon heavy imports from overseas. This would be entirely counterproductive, both environmentally and economically.

“The skills, experience and infrastructure of a world-class oil and gas industry will play a crucial role in accelerating energy transition and meeting net zero.”

Russell Borthwick, the chief executive at Aberdeen and Grampian Chamber of Commerce, said: “Oil and gas will continue to be required throughout the transition to net-zero carbon, and new fields will be required to meet our domestic supply needs in the meantime.

“The alternative is importing oil and gas from other parts of the world, which would increase the carbon footprint of our energy use. This would be madness. We need our government, industry, and politicians of all parties to make this get our transition steps in the right order to protect jobs, provide retraining opportunities and create new ones.”

Shell has a 30 per cent stake in Cambo. Its decision to pull out raises questions over whether the offshore oil and gas industry will be able to develop any new sites. Green groups have been campaigning to block the project, which was expected to extract up to 170 million barrels of oil over 25 years.

Wood, one of Scotland’s most successful businessmen, described Sturgeon’s U-turn last month as “counterproductive and damaging”. He said that there was evidence that hydrocarbons would be needed to meet energy needs until at least 2060, and that prematurely ending operations would place up to 100,000 jobs at risk.

Shell said in a statement: “After comprehensive screening of the proposed Cambo development, we have concluded the economic case for investment in this project is not strong enough at this time, as well as having the potential for delays. However, continued investment in oil and gas in the UK remains critical to the country’s energy security.”

Jonathan Roger, the chief executive of Siccar, said: “While we are disappointed at Shell’s change of position, we remain confident about the qualities of a project that will not only create over 1,000 direct jobs as well as thousands more in the supply chain, but also help to ease the UK’s transition to a low-carbon future through responsibly produced domestic oil instead of becoming even more dependent on imports with a relatively higher carbon intensity. We will continue to engage with the UK government and wider stakeholders on the future development of Cambo.”

Patrick Harvie, of the Scottish Greens, who serves in Holyrood as minister for zero carbon buildings, was accused of cheering on potential job losses. He told BBC Radio Scotland that it was “great the the Cambo project looks like it’s on the skids”.

Liam Kerr, the Scottish Conservatives shadow minister for net zero, described Harvie’s stance as “shameful” and said: “The Cambo project not going ahead would risk Scottish jobs, risk our energy supply, and risk our ability to meet net zero targets.

“Patrick Harvie wrongly brands supporters of Scotland’s oil and gas industry as ‘hard right’, which is insulting to the tens of thousands of workers in our North Sea sector. Nicola Sturgeon must distance her government from these comments quickly. Her opposition to future oil and gas projects seems to be discouraging investment already. It won’t help if she lets government ministers take pot shots at everyone who works in oil and gas.”

A recent YouGov poll found that 38 per cent of voters in northeast Scotland backed drilling off the west coast of Shetland, while 27 per cent were opposed. The rest were unsure.