Oil and gas workers signal support for ‘just’ net-zero transition

The “Our Power” survey from Platform and Friends of the Earth Scotland, features the findings of more than 1,000 oil and gas workers over the last two years. It has transformed these findings into a list of demands that the sector believes policymakers should take to protect jobs while prioritising net-zero emissions growth.

The findings call for a government-backed jobs guarantee for workers in the sector, as well as an offshore training passport that supports workers to retrain in the renewables sector. Additionally, the workers are calling on oil and gas companies to pay for the decommissioning of offshore rigs and investing in ports and renewable manufacturing hubs to create local jobs in the UK.

The demands have been backed by major unions including the RMT, Unite Scotland, Unison Scotland and Uplift, among others, with more than 10% of the workforce being balloted by Unite alone.

The call to action states that a worker-led just transition would see money reinvested into local communities, rather than major oil firms continuing to take home huge profits. Indeed, give oil and gas firms made almost $200bn in profits globally in 2022, but 73% of oil and gas companies invest nothing in renewable energy production in the UK.

The unions state that neither the Government nor the Labour Party have created plans for a low-carbon transition of the sector that benefits the workers, with the Government instead focusing on handing out more licenses for oil and gas exploration.

Friends of the Earth Scotland head of campaigns Mary Church, said: “Our current energy system is destroying our climate, is unaffordable to millions and is failing the people who work in it. Climate science is crystal clear that we have to rapidly phase out fossil fuels if we want a liveable future.

“Failure from politicians to properly plan and support the transition to renewables is leaving workers totally adrift on the whims of oil and gas companies, and the planet to burn. The Scottish/UK Government must pick up these demands and run with them as part of their just transition plan for the energy sector.”

Transitions and transactions

The oil and gas workers are specifically concerned about pay during any future transition. Current salary thresholds set by the UK Government have seen some workers paid less than £5 per hour while working 12 hour days, seven days a week, according to the survey.

In 2021, the Government unveiled its North Sea Transition Deal, much to the disappointment of campaigners. The deal promises to support oil and gas industry workers and businesses by introducing low-carbon solutions such as hydrogen production, Carbon Capture Usage and Storage, offshore wind and decommissioning.

A number of interim targets have been set, namely for the sector to reduce emissions by 10% by 2025 and 25% by 2027 before delivering a 50% reduction by 2030. In the same timeframe, the sector will voluntarily commit to ensuring that 50% of all offshore decommissioning and new energy projects are provided by local businesses, which will support job growth.

Ongoing tax relief for the UK’s oil and gas sector has been also been criticised. The Green Alliance has published research warning that tax reliefs and subsidies that are paid to gas companies operating in the North Sea are wasting taxpayer money.

The report notes that the UK has one of the lowest taxes on oil and gas production, at around $2 per barrel in 2019, compared to $22 per barrel for nations like Norway. As such, major oil giants including BP and Shell are incentivised to drill in the North Sea. The Green Alliance notes that between 2016 and 2020, oil and gas companies received around £10bn in tax relief for exploration and production and £3.7bn in tax relief for decommissioning costs.

As such, the Green Alliance predicts that oil and gas production will become a significant annual expenditure, with taxpayers set to front the costs of an estimated £18.3bn in decommissioning figures.