Harbour Energy and challenges facing Scotland's offshore energy sector: letter from First Minister

Dear Russell

I am writing in reply to your letter on the challenges facing Scotland’s offshore energy sector, including the deeply concerning announcement from Harbour Energy that it expects to need to cut around 250 roles from its Aberdeen office.

The Scottish Government shares your desire that any job losses are avoided and that sustainable energy job creation is accelerated.

The Deputy First Minister met with Harbour Energy last week, during which they set out the challenges facing the company. This included the impact of the UK Government’s reserved fiscal and regulatory regimes. We recognise those concerns and continue to urge the UK Government to urgently provide stability and certainty to industry.

Despite my Government’s opposition, the Energy Profits Levy was extended by the previous Conservative UK Government and further extended and increased by the current Labour UK Government. It is clear to me that those extensions to the EPL have damaged investment, and the very supply chain we need to deliver net zero.

I am aware that the UK Government is currently consulting on a successor fiscal regime and hope that an improved, long-term regime will result from the consultation process. We will continue to call on the UK Government to provide Scotland’s offshore energy sector with much needed certainty, and importantly, ensure it is treated fairly alongside other parts of the UK economy.

You also set out the importance of Acorn and the Scottish Cluster in creating and safeguarding energy and supply chain jobs, a view you know I share. In my Programme for Government, I reinforced this with a willingness to increase the amount of Scottish Government funding available to support Acorn and the Scottish Cluster beyond the £80 million we have previously committed. This is contingent upon the UK Government confirming a full-funding package and timeframe for Acorn at the Spending Review. As you will be aware, I am determined that the UK Government should give the same level of support to projects in Scotland as has been given to those in Scunthorpe and Teeside.

I note your suggestion that the Prime Minister and I co-chair a summit on jobs in the energy sector. I am very happy to agree to that and have asked my officials to contact you to discuss what would be involved. I will look forward to hearing further details in due course.

JOHN SWINNEY