The UK could meet half of its oil and gas demands domestically without imports if the government provides more support to the sector, according to a report by Offshore Energies UK (OEUK). The industry group suggests that modifying the windfall tax on energy firms and approving projects like the controversial Rosebank and Jackdaw fields could unlock 111 projects, potentially attracting £50 billion in investment.
North Sea output has been declining, with projections indicating that domestic supplies will only cover about one-third of the UK's demand until 2050. OEUK stated that its proposals aim to support domestic production and displace rising imports. The report calls for the current Energy Profits Levy (EPL), a windfall tax set to be replaced in 2030, to be abolished by January. A proposed replacement, the Oil and Gas Revenue Levy, would only be activated during price spikes. The industry has argued that the EPL has deterred investment, as it remains in place even when wholesale energy prices fall.
Last year marked the first time since the North Sea began producing oil and gas that no exploration wells were drilled. OEUK highlighted that the oil and gas industry supported 180,000 jobs across the UK in 2024. The report argues that "fiscal reform and a pragmatic approach to licensing could unlock investment and improve long-term energy security," emphasizing that boosting domestic energy production is crucial for protecting households, businesses, and the economy from global instability.
OEUK Policy Director Enrique Cornejo stated, "Britain is at a critical juncture. Our industry is ready to invest and deliver more homegrown oil and gas, but the window for action is narrowing." He warned that without urgent policy decisions, the UK risks increased dependence on imports and the loss of high-value jobs. The industry also seeks a clear signal of long-term support for domestic oil and gas, specifically mentioning the Rosebank and Jackdaw developments, which are currently under consideration by the industry regulator. These projects had previously received approval under the former Conservative government but faced legal challenges on environmental grounds in Scottish courts, leading to other potential projects being put on hold.
Environmental group Uplift dismissed OEUK's report as a "fantasy," characterizing the North Sea as an "ultra-mature" basin with limited reserves. Director Tessa Khan argued that new drilling would not lower bills or significantly improve energy security, adding that "the science is clear that the world already has far more oil and gas than can ever be safely burned if we are to limit warming." Among the projects OEUK identified as potentially unlockable are a second phase of the Rosebank development, the Cambo field, and Clair South, all located west of Shetland. OEUK noted that most of the 111 projects are within existing licensed areas, despite the current UK Labour government's ban on new exploration licenses.
A UK government spokesperson commented, "We're giving the sector and its investors the long-term certainty to plan, invest and support jobs with plans to replace the EPL when it ends by 2030, or earlier if its price floor is triggered." The spokesperson added, "We are also making sure the North Sea has a prosperous and sustainable future through record investment that helps deliver the next generation of skilled jobs while growing the clean energy industries of the future."