Committee opposes suspension of deep-water oil drilling

A committee of MPs has opposed any moratorium on deep water drilling for oil in the UK's seas, warning such a move would undermine the country's energy security.

But the Energy and Climate Change Committee raised doubt about whether equipment used to tackle oil spills could do its job in the harsh conditions west of Shetland, where drilling in water up to 1,000 metres deep is taking place.

And a lack of clarity over liability laws could leave the UK taxpayer picking up the bill for a major oil spill offshore, a report by the committee in the wake of the Gulf of Mexico oil disaster warned.

The MPs launched their inquiry to examine the implications of the explosion on BP's Deepwater Horizon rig 50 miles off the Louisiana coast which killed 11 workers and left millions of barrels of oil pouring into the sea.

The committee's report suggested a moratorium on drilling west of Shetland - which has been urged by environmental groups - would leave the UK more reliant on imports of oil and gas.

The committee's chairman Tim Yeo said: "A moratorium on deep water drilling off the west coast of Shetland would undermine the UK's energy security and isn't necessary."

But he said: "The harsh and windy conditions in the North Sea would make an oil spill off the coast of Shetland very difficult to contain or clean up.

"Safety regulations on drilling in the UK are already tougher than they were in the Gulf of Mexico, but oil companies mustn't use that as an excuse for complacency."

The report said the conditions to the west of Shetland were far more difficult than those experienced by teams tackling the spill in the Gulf of Mexico.

The MPs said plans to deal with a spill should be site-specific, systems for tackling oil leaks must fit the harsh weather in the North Sea and that the environmental impacts of an oil well blowing out needed to be understood and taken into account when licences were granted.

The committee also said the £158 million liability limit in the voluntary Offshore Pollution Liability Association is not enough.

And it warned the liability only covers "direct damage" - an unclear definition which could allow companies to argue that damage to wildlife and habitats was indirect, and did not qualify for compensation.

The committee also said the equipment which should have acted as the last line of defence against the blow-out on the Deepwater Horizon rig failed in part due to a failure to make simple checks such as whether the device's battery was charged.

It said the UK inspection regime should never allow "such simple, potential failures" to go unchecked.

And it urged the Health and Safety Executive to consider making two of the devices, known as blind shear rams which are designed to slice through the drill pipe and seal it, a requirement on all UK deep water rigs.

Offshore rigs must also have somebody who had the authority to stop drilling operations at any time without having to refer to managers onshore, and that their primary duty was the safety of personnel and protection of the environment, the report said.

In the wake of the report, the RMT union said it remained "deeply concerned" safety representatives did not have sufficient powers and demanded they must be free to challenge employers on safety issues without the fear of punishment, including having the power to stop the job.

And green campaigners renewed their call for a moratorium on deep water drilling in UK waters, amid concerns over the environmental threats of deep sea drilling and the UK's reliance on fossil fuels,

John Sauven, executive director of Greenpeace which has launched a legal bid to halt the granting of new drilling licences, said: "This report lists all the reasons why a ban on deep sea drilling makes sense and then ignores its own findings.

"The oil companies have no idea how they would deal with a major spill off the coast of the UK but apparently we're supposed to trust them until they come up with an adequate plan."

And Dan Barlow, head of policy at WWF Scotland, said: "This report highlights that the current UK oil drilling framework falls short of providing the necessary safeguards to protect Scotland's marine environment in the event of an oil spill.

"Given the environmental imperative to end our addiction with oil, the focus of our energy policy must be on making a renewables revolution a reality.

"Pursuing new oil would undermine the leadership role this country has built on tackling climate change and progressing toward a low carbon economy."

But the Government welcomed the report's conclusion that a moratorium was unwarranted.

Energy Minister Charles Hendry said: "We looked at our regime and increased inspections immediately after Deepwater Horizon and plan a further review once US reports and the detailed analysis of the factors which caused the Gulf of Mexico incident are available."

He added: "As we move towards a less carbon intensive future, oil and gas are set to remain a key part of our energy system for years to come and it is vital that we search for and produce the UK's own resources as safely as possible."

Malcolm Webb, chief executive of industry body Oil & Gas UK, said it welcomed the committee's statement that a moratorium on drilling in the UK was "not only unnecessary but would also undermine UK energy security".

He added: "We also warmly welcome the committee's utter rejection of calls for increased regulatory oversight from the European Commission, which we believe could weaken the UK's strong regulation and safety performance."

The body said the Oil Spill Prevention and Response Advisory Group (Osprag) had already made significant progress in addressing a number of the concerns raised by the committee.