We recognise the significant contribution which the oil and gas sector makes to our economy and our society. We are also clear that any further extraction and use of fossil fuels must be consistent with Scotland’s climate obligations and Just Transition commitments.
We need to take an evidence-based approach to the energy transition.
Our focus is on meeting Scotland’s energy security needs, reducing emissions and ensuring a just transition for our offshore oil and gas workforce as North Sea resources decline.
Offshore oil and gas licensing is reserved to the UK Government, whereas onshore oil and gas licensing is devolved. We are also responsible for the skills and training policy. Scotland’s valued and highly skilled existing offshore oil and gas workforce will be essential to the energy transition. We are working with industry and other stakeholders to plan for a multi-skilled workforce, that can benefit from opportunities across the energy system.
Actions
We are committed to supporting a just energy transition on Scotland’s journey to net zero by:
- launching an Oil and Gas Transition Training Fund (July 2025) - designed and developed by the Scottish Government and delivered by Skills Development Scotland, working in partnership with UK Government’s Regional Skills Pilot for Aberdeen and Aberdeenshire, the fund aims to support oil and gas workers to access opportunities across sustainable energy sectors through careers advice and funding for training
- looking at Scotland's future energy system, including a recent refresh of baseline data - this shows that that the offshore oil and gas sector supported 53,000 direct and supply chain jobs in Scotland and contributed £28bn in GVA to Scotland’s economy in 2022
- working with partners to develop carbon capture, utilisation and storage in Scotland
- supporting a number of demonstration projects to develop hydrogen and hydrogen fuel cells
- supporting the transition in the North East of Scotland from oil and gas to renewables with our Energy Transition Fund
- supporting businesses, communities and individuals to transition to net zero and create jobs in low carbon industries through the Just Transition Fund
- working with the North Sea Transition Deal (NSTD) through both the North Sea Transition Forum and the North Sea Transition Deal Delivery Group
Background
Offshore oil and gas licensing
The UK Government is responsible for the regulatory and fiscal regimes for the offshore oil and gas industry operating on the UK Continental Shelf.
The North Sea Transition Authority (NSTA) is the UK offshore oil and gas sector’s independent regulator. The Authority is a public body which is within the policy framework set by the UK Government. The NSTA regulates the licensing of exploration and development of the UK’s offshore oil and gas resources, gas storage and unloading activities.
The Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) is the UK regulator of environmental and decommissioning activity for offshore oil and gas operations.
The UK Government is also responsible for regulating the risks to health and safety arising from work activities in the offshore oil and gas industry operating on the UK Continental Shelf. This is overseen by independent regulator the Health and Safety Executive.
Onshore oil and gas licensing
Onshore oil and gas licensing powers were devolved on 09 February 2018. Commencement of sections 47 to 49 of the Scotland Act 2016 transferred powers to:
- legislate for the granting and regulation of onshore licences
- determine the terms and conditions of licences
- regulate the licensing process, including administration of existing onshore licences
The consideration payable for such licences remains a reserved matter. The regulation, including setting, of the consideration payable for a licence is therefore reserved. In addition, the UK Government has powers to revoke a licence on the basis of failure to make payments due under the licence. The NSTA is responsible for administering these issues on behalf of the UK Government.
A memorandum of understanding has been signed with the UK Government and the NSTA setting out arrangements in respect of the reserved matters. The terms of the onshore oil and gas licences currently held in Scotland are set out in legislation.
Onshore oil and gas policy
In October 2019, we reached a final policy position that we do not support the development of unconventional oil and gas in Scotland. This means no support for development connected to the onshore exploration, appraisal or production of coal bed methane or shale oil or shale gas using unconventional oil and gas extraction techniques, including hydraulic fracturing and dewatering for coal bed methane.
In June 2025, we reached a final policy position that we do not support the development of onshore conventional oil and gas. This means the development connected to the onshore exploration, appraisal or production of petroleum, or crude oil, and raw natural gas from the ground by conventional means and methods. The policy position was subject to statutory and other assessments before the policy-making process was completed, including in our draft Energy and Just Transition Plan, and our National Planning Framework 4 (NPF4).
We have developed an interactive map to provide access to information about the onshore licences currently held in Scotland.
Datasets for onshore oil and gas exploration and appraisal wells drilled under licenses previously held in Scotland on the British Geological Survey’s Onshore Geoindex interactive map.
Coal extraction policy
Coal exploitation is a matter reserved to the UK Government, and the Mining Remediation Authority is responsible for licensing coal mining activity in Scotland. However, planning policy and determinations are devolved to the Scottish Government.
In June 2025, we reached a final policy position that we do not support coal extraction. The policy position was subject to statutory and other assessments before the policy-making process was completed, including in our draft Energy Strategy and Just Transition Plan , and our National Planning Framework 4 (NPF4.
We recognise coal extraction may be legally required in some circumstances, for example in building works or where a seam needs to be removed during foundation preparation. Licence holders from the Mining Remediation Authority may apply for planning permission for coal mining-related activities. As a matter of law, all planning applications must be determined in accordance with the development plan, unless material considerations indicate otherwise. As a statement of national policy, the finalised policy position on coal extraction would be a material consideration.
Bills and legislation
The Scotland Act 2016 devolved onshore oil and gas licensing powers to Scotland.
All other oil and gas legislation is reserved to the UK Government.
Contact
Email: ceu@gov.scot