Living in the present, making the future:

UK scenarios for the phase-out of oil and gas

Why wait until 2050

Date of publication: September 2022

Authors: Kirsten Jenkins, Navraj Singh Ghaleigh, Stuart Haszeldine, Andi Sihota

Executive summary

In May 2021, the International Energy Agency’s (IEA) roadmap for the global energy sector to reach net-zero emissions by 2050 highlighted that decarbonisation levels aligned with the Paris Agreement do not permit investment in new oil and gas fields. The value chain transitions required as a result will have large-scale implications for the labour forces in a range of sectors and related communities. In the United Kingdom (UK), despite early ambition towards the phase-out of oil and gas, debates remain heated and practical action is slow and scarce. There is, therefore, a pressing need to consider the scenarios by which transitions away from these fossil fuels in the UK might be achieved.

The pathways for any transition must be co-created to ensure stakeholders’ buy-in. Through co-creation, we emphasise that while urgent action is required to meet climate targets and ensure ‘just transition’ outcomes, research and practice need to inform the increasingly important policy mechanisms, which need to have high degrees of both policy efficacy and social acceptability.

This report presents the results of a scenario workshop which took place online via Teams over two half days in early May 2022. The research team considered two scenarios for the phase-out of oil and gas: (1) the “median anticipated pathway” and (2) “rapid exit”. The workshop discussed the milestones needed to achieve these visions, the actors responsible for their realisation, the main opportunities and bottlenecks and the cross-cutting debates around (1) the incumbent actors and lock-in that could delay or disable the transition and (2) what the just transition means and whom it affects.

This workshop and report represent a first step rather than a final outcome and reinforces the need for future engagement with opportunities and bottlenecks in the phase-out of UK oil and gas. Although limited in the capacity to draw concrete conclusions and milestones, particularly given the lack of consensus amongst workshop participants, in light of the discussions the research team identified 12 key intervention points that should be realised under government leadership and oversight:

  1. Foster collaborative intergovernmental relations between Westminster and the devolved administrations of Scotland, Wales and Northern Ireland, which are effective at driving change and action
  2. Strengthen the governance of the transitions process
  3. Require the government to quantify and publish the estimated implications of continued oil and gas exploration, appraisal and production along with the median anticipated pathway and rapid exit scenarios
  4. Note proposals from the North Sea Transition Authority for a Climate Compatibility Checkpoint (CCP) test on new oil and gas offshore developments
  5. Make a firm decision to rapidly consent, construct and operate Carbon Capture and Storage (CCS), one project of which could be a Carbon Takeback Obligation, a mechanism for placing responsibility for an increasing portion of CO2 storage or disposal on fossil fuel extractors and importers
  6. Standardise labour force qualifications, to facilitate workers’ migration between employers and sectors
  7. Actively coordinate and foster participatory processes between various levels of government (local, devolved, national) and diverse oil and gas industry stakeholders
  8. Support readiness to deploy low-carbon technologies and supply chain diversification
  9. Implement mechanisms such as Scotland’s ‘National transition training fund’ across the UK to enable re-skilling and up-skilling of a large portion of offshore workforce
  10. Develop quantitative, binding targets for the phase-out of oil and gas
  11. Elaborate a just transition and its stated aims and audiences to enable ongoing, open debate
  12. Inform the above through identified just transition principles.

This report and its recommendations contribute to an ongoing package of work as part of Oil & Gas Transitions, an international research project that maps opportunities and bottlenecks for restructuring the petroleum sector in the North Sea.