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SNP accused of exaggerating North Sea oil reserves by up to 60% SNP accused of exaggerating North Sea oil reserves by up to 60%
(7 months later)
Sir Ian Wood, the most influential figure in the Scottish oil industry, has accused Alex Salmond's government of exaggerating North Sea oil reserves by up to 60%.Sir Ian Wood, the most influential figure in the Scottish oil industry, has accused Alex Salmond's government of exaggerating North Sea oil reserves by up to 60%.
Wood, the billionaire founder of the oil services firm Wood Group, said the first minister's administration had also overestimated North Sea oil income over the next five years by up to £2bn a year or £370 per person, raising serious questions about Salmond's public spending plans.Wood, the billionaire founder of the oil services firm Wood Group, said the first minister's administration had also overestimated North Sea oil income over the next five years by up to £2bn a year or £370 per person, raising serious questions about Salmond's public spending plans.
Revealing himself as an opponent of Scottish independence, Wood said North Sea oil reserves would begin to decline sharply within 15 years, raising questions about the future of the Scottish economy, jobs and its balance of payments if voters backed independence.Revealing himself as an opponent of Scottish independence, Wood said North Sea oil reserves would begin to decline sharply within 15 years, raising questions about the future of the Scottish economy, jobs and its balance of payments if voters backed independence.
In a wide-ranging interview with the industry website energyvoice.com, Wood also said an independent Scotland would likely lose the UK's heavy subsidy of the new windfarms and marine energy plants it needed to hit Salmond's target of generating 100% of the country's electricity from renewable sources by 2020.In a wide-ranging interview with the industry website energyvoice.com, Wood also said an independent Scotland would likely lose the UK's heavy subsidy of the new windfarms and marine energy plants it needed to hit Salmond's target of generating 100% of the country's electricity from renewable sources by 2020.
That raised questions for younger Scottish voters in September's referendum, he said, as Salmond has repeatedly predicted there were up to 24bn barrels of oil equivalent (bboe) still to be extracted – at the top end of estimates used by the industry body Oil and Gas UK.That raised questions for younger Scottish voters in September's referendum, he said, as Salmond has repeatedly predicted there were up to 24bn barrels of oil equivalent (bboe) still to be extracted – at the top end of estimates used by the industry body Oil and Gas UK.
Based on that 24bboe figure, Salmond and the Yes Scotland independence campaign have repeatedly cited the potential value of Scotland's oil reserves as £1.5tn, a figure dismissed as fanciful by the Treasury and other economists.Based on that 24bboe figure, Salmond and the Yes Scotland independence campaign have repeatedly cited the potential value of Scotland's oil reserves as £1.5tn, a figure dismissed as fanciful by the Treasury and other economists.
Wood said he believed the "best outcome" would be 15 to 16.5bboe left to extract. That is in the mid range of Scottish government predictions, leaving Scotland dependent on shale oil and gas imports from England from 2030 onwards. "The offshore oil and gas industry cannot figure significantly in Scotland's medium-term economic calculations," Wood said.Wood said he believed the "best outcome" would be 15 to 16.5bboe left to extract. That is in the mid range of Scottish government predictions, leaving Scotland dependent on shale oil and gas imports from England from 2030 onwards. "The offshore oil and gas industry cannot figure significantly in Scotland's medium-term economic calculations," Wood said.
"Young voters in the referendum will only be in their 40s when they will see the significant rundown in the Scottish offshore oil and gas sector, and the serious implications for our economy, jobs and public services.""Young voters in the referendum will only be in their 40s when they will see the significant rundown in the Scottish offshore oil and gas sector, and the serious implications for our economy, jobs and public services."
Although other economists have backed Salmond's predictions about the strength of Scotland's economy under independence, including Sir Donald Mackay, a former chairman of Scottish Enterprise, Wood's intervention is a blow to Salmond. Although other economists have backed Salmond's predictions about the strength of Scotland's economy under independence, including Sir Donald Mackay, a former chairman of Scottish Enterprise, Wood's intervention is a blow to Salmond.
One of Scotland's most respected industrialists, Wood was the author of a major UK government-commissioned study into maximising North Sea production earlier this year, which was lauded by Salmond. He also chaired an employment commission for the first minister.One of Scotland's most respected industrialists, Wood was the author of a major UK government-commissioned study into maximising North Sea production earlier this year, which was lauded by Salmond. He also chaired an employment commission for the first minister.
Wood is also a dominant figure in Aberdeen, the centre of the UK's oil industry, where he offered to donate up to £75m for a public park redevelopment in the city centre, which was heavily backed by Salmond's Scottish National party.Wood is also a dominant figure in Aberdeen, the centre of the UK's oil industry, where he offered to donate up to £75m for a public park redevelopment in the city centre, which was heavily backed by Salmond's Scottish National party.
Alistair Darling, the former Labour chancellor and head of the pro-UK Better Together campaign, said Wood's analysis "fatally undermines" Salmond's oil predictions and "blow apart Alex Salmond's plans for funding schools and hospitals."Alistair Darling, the former Labour chancellor and head of the pro-UK Better Together campaign, said Wood's analysis "fatally undermines" Salmond's oil predictions and "blow apart Alex Salmond's plans for funding schools and hospitals."
Darling added that it was "devastating for his ridiculous claims on pensions and on jobs".Darling added that it was "devastating for his ridiculous claims on pensions and on jobs".
Fergus Ewing, the Scottish energy minister, said Wood's predictions were more generous than those of the UK government's Office for Budget Responsibility, but Scotland was wealthy enough to live without huge oil revenues.Fergus Ewing, the Scottish energy minister, said Wood's predictions were more generous than those of the UK government's Office for Budget Responsibility, but Scotland was wealthy enough to live without huge oil revenues.