North Sea Oil and Gas

– in the House of Commons at 12:00 am on 23rd June 1971.

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Photo of Mr John Eden Mr John Eden , Bournemouth West

The national interest is adequately covered by the conditions governing the tender arrangements. In the event of success, the consumer will be protected by the normal market forces which apply under both methods of application.

Photo of Mr Michael Foot Mr Michael Foot , Ebbw Vale

May I suggest to the hon. Gentleman, first, that perhaps the best way of dealing with a matter of this kind is not by answering a Written Question late at night, at the same time as he is holding a Press conference and announcing, according to The Times report, a major change of policy, and that perhaps it might be better to make such announcements to the House of Commons, as has been done on some previous occasions in dealing with this matter?

Second, may I ask the hon. Gentleman whether he will give an absolute assurance that these new arrangements are still governed by Section 9, I think it is, of the Continental Shelf Act, which provides that the Government shall have the power to survey the prices at which the gas is offered, or the resources are offered, to the Gas Council, and that the Government retain the powers provided in that Act, and that those powers will govern all the tenders whether made under competitive tender or under previous arrangements under these proposals?

Third, does the hon. Gentleman not think that it is somewhat invidious that he should embark upon this major change of policy, on a matter which may involve hundreds of millions of pounds passing from the public to private pockets or possibly away from public industries, at a time when in another place his Department has been refusing to give answers on what is involved in the increase in price which the Gas Council has agreed to pay, and when the Government have refused to intervene on, or even to survey, an increase in price which has taken place in that area—as I say, perhaps involving millions and millions of pounds over the years? Does he not think that it is all the worse—[HON. MEMBERS: "Get on with it."]—when the policy involves a grave discrimination against public industry, and when the policy change involves a departure from the previous policy, under which it was guaranteed that the National Coal Board and the Gas Council, publicly-owned industries, should be able to participate in the exploitation of this great national resource?

Photo of Mr John Eden Mr John Eden , Bournemouth West

The question of a statement is, of course, a matter for the Leader of the House

Photo of Mr John Eden Mr John Eden , Bournemouth West

The hon. Member for Ebbw Vale (Mr. Michael Foot) has rather got matters out of proportion. What we are talking about in the competitive tender arrangements amounts to about 3 per cent. only of the territory on offer. It is of significance in order to give this country experience of the value of combining tendering procedure with the discretionary licensing arrangement which has always applied hitherto. All, or most, other countries have had the tendering procedure in operation for a long time. It is right that we should try, on a very limited front—which is all this is—to see whether it has relevance to this country. This is simply an experiment.

The conditions of the Continental Shelf Act still apply both to the tendering blocks and to the other blocks. As for the hon. Member's final point about the nationalised industries, what we have done is remove the discrimination in their favour put there by the last Government.

Photo of Mr Trevor Skeet Mr Trevor Skeet , Bedford

I welcome the Minister's suggestion. Bearing in mind that experience is to be obtained in tendering, why is it not possible to put up at least 50 per cent. of the properties for tender? Will my hon. Friend give some intimation of the type of conditions which he has attached thereto, or circulate them in the OFFICIAL REPORT?

Photo of Mr John Eden Mr John Eden , Bournemouth West

The conditions pertaining to the blocks on offer under competitive tender are set out in the London Gazette of yesterday. The criteria applying to them are similar to the criteria which apply to the discretionary blocks; namely, those affecting the requirement that the companies shall be British-registered, that there shall be reciprocity of treatment with the country of origin of the company applying, the technical competence of the company applying and so forth. These things still apply to the tender blocks as to the other discretionary blocks.

My hon. Friend also asked why more blocks should not be put on offer. This is simply because we felt it right to have a limited experiment only, to see what the value of this was in the United Kingdom's interests. This is why it has been decided not to go further than the 3 per cent. of the total blocks on offer—15 in all.

Photo of Mr Jo Grimond Mr Jo Grimond , Orkney and Shetland

Is the hon. Gentleman aware that considerable quantities of oil and gas have now been found off the coast of Scotland and Northern England, and that these regions are in great need of new capital? Is he taking any steps to see that they in particular benefit from this discovery of wealth off their shores?

Photo of Mr John Eden Mr John Eden , Bournemouth West

If this wealth is discovered off their shores as the right hon. Gentleman says, no doubt it will be in the interests of those who discover it in the United Kingdom waters adjacent to those territories to bring it ashore at the closest possible point. It will then be a matter for the companies concerned as to what happens to it.

Photo of Sir Gerald Nabarro Sir Gerald Nabarro , Worcestershire South

I congratulate my hon. Friend warmly on this departure from the policy of the previous Government, all of which is exactly in accord with the policies of the Conservative Party. Would he bear in mind that there are almost limitless resources of natural gas in the North Sea, and that participation by a large number of competing bodies will probably engender a demand for great numbers of new oil rigs, all of which are capable of being built on the Clyde? Will he bring to the attention of his appropriate colleagues the potential for building oil rigs on the Clyde, instead of the traditional vessels in the Clyde yards?

Photo of Mr John Eden Mr John Eden , Bournemouth West

Yes, Sir; I will do as my hon. Friend suggests. He is right to say that, in addition to the actual work of oil and gas exploration, there is the immensely important back-up industrial benefit which flows to this country from this highly successful operation.

Photo of Mr Michael Foot Mr Michael Foot , Ebbw Vale

Will the hon. Gentleman take note—as I hope the Leader of the House will take note—that, although he may regard this as a minor matter, we certainly do not, that we think it is improper that it should have been dealt with in this way, and that we think it should be fully debated in the House, so that we can have all the facts about the gas price and how it was done debated openly in the House and not concealed, as the Government are seeking to do. We want it all out in public instead of done under the carpet as the hon. Gentleman tried to do it.

Several Hon. Members:


Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

Order. I know that hon. Members want to ask further supplementary questions, but I must say that my willingness to accept Private Notice Questions is inhibited by the length of time which they will take. This one has taken 10 minutes, which I think is enough, and other ways must be found of debating the matter. If it is felt that on every Private Notice Question there should be 20 minutes in which to ask questions, that would affect my judgment in allowing it.

Photo of Mr Michael Foot Mr Michael Foot , Ebbw Vale

On a point of order arising from your statement to the House, Mr. Speaker. May I underline the fact that in November, 1965, when the previous Government were making announcements on this subject, the Government at that time took the responsibility of coming to the House to make a statement. If that procedure had been followed on this occasion, it would not have been necessary for me to ask you to allow me to put a Private Notice Question. So I hope you will not take as any precedent the fact that this Private Notice Question had to be put down. It had to be put down because the Government were trying to deprive the House of facilities which were available before.

Photo of Mr William Whitelaw Mr William Whitelaw , Penrith and The Border

Further to that point of order Mr. Speaker, I should make clear to the House the policy which I have consistently stated and which I believe to be right. It is that we have to be very careful to safeguard the business of the House in the number of statements which are allowed after Questions. This problem has been faced by all Governments. I have made clear to the House my principle, which is that I seek to limit these statements to those occasions when I believe that they are rightly and necessarily required by the House. My judgment may be wrong. I am responsible for my own judgment, and I am very ready to stand up and face criticism on it. I told my hon. Friend the Minister for Industry to put the responsibility on me, because it was my decision not to have this statement—

Hon. Members:

You cannot hide behind that.

Photo of Mr William Whitelaw Mr William Whitelaw , Penrith and The Border

I am not hiding behind it: it was my decision. I find it difficult to know why I should be accused of hiding behind a decision when I am taking full responsibility for it. If I have been wrong, I can be criticised and am ready to be criticised. I was acting in what I thought to be the best interests of the House, as I still believe I was doing. I will certainly take into account the hon. Member's criticisms and I will bear them in mind in future. But very difficult decisions come to me on the question of what statements should be made and what should not. I did my best to act in the interests of the House as a whole.

Photo of Mr Michael Foot Mr Michael Foot , Ebbw Vale

Further to that point of order, Mr. Speaker. I apologise for detaining the House for one moment more, but this is a matter of some importance. I fully agree that it is difficult for any Government to select the subjects on which statements should be made, but the right hon. Gentleman did not tell the House that the Department had asked for a statement to be made on the subject and that the request had been refused. Further, I cannot believe that the Leader of the House authorised the Department to make the answer given to a Question last night in the House of Commons which purported to be a statement on this matter as a whole but which treated it as a trivial matter when, at the same time, the Minister was saying—outside the House—that he was making a major change of policy. Major changes of policy on matters involving hundreds of millions of pounds should be made in the House of Commons. I believe that, on consideration, the right hon. Gentleman will accept that view.

Photo of Mr William Whitelaw Mr William Whitelaw , Penrith and The Border

I have nothing to add to what I have said, which is that I take responsibility for the matter. I take full responsibility for this and for the consequences which follow from it. I took responsibility for the original decision. I note what the hon. Member has said.

Photo of Mr Stan Orme Mr Stan Orme , Salford West

The question of gas prices and the consortium was raised in the House of Lords. No answer was given by the Government to any questions. Last night the Minister gave a Written Answer, and today he has come to the Dispatch Box, and he has not given any detailed answers about finance, profits or investments. In that case, hon. Members who want to press further questions upon him surely have a right to do so. The Government were deliberately denying us the information that we wanted.

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

These all sound suitable matters to raise if some means can be found to debate the issue. I simply desired to make it clear that I was prepared to permit a certain amount of questioning but that, on the general matter of Private Notice Questions, it will affect the Chair very much if it is thought that every time one is allowed 20 minutes of the time of the House is to be devoted to it. I should be willing to allow many more Private Notice Questions if I felt that they would be dealt with expeditiously.

Photo of Mr Alexander Eadie Mr Alexander Eadie , Midlothian

You have made a pronouncement to the House, Mr. Speaker. I would point out that you are the servant of the House in this respect. [Interruption.] Mr. Speaker is the servant of the House, and he will not deny it. This issue must be cleared up. In view of the exchanges to which you have listened, Mr. Speaker, would you not now care to amend what you have said about Private Notice Questions? It is open to Government and Opposition back benchers to raise Private Notice Questions if they find that Governments tend to hide executive decisions. Back benchers must try to use the procedures of the House on occasions in order to expose clandestine decisions that Governments are attempting to make. I suggest that in the light of the exchanges which have taken place today, Mr. Speaker, you, as the protector and custodian of the rules of the House, may care to amend your statement in relation to debating Private Notice Questions.

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

Of course I am the servant of the House, but I am entrusted by the House with certain discretions, one of which is to decide whether or not to allow a Private Notice Question and another is to decide how long I should permit supplementary questions to take. In this case, I allowed 10 minutes' questioning, which I think was not out of proportion. Of course I am not laying down an absolutely fixed rule, and I shall exercise my discretion from time to time. I am grateful to the hon. Member for his help.

Photo of Mr Tom Driberg Mr Tom Driberg , Barking

May I, with great respect, Mr. Speaker, ask you to keep reasonably flexible the Ruling that you have just given? Surely a Private Notice Question must be considered by the Chair on the merits or importance of the subject of the Question and not only whether it will attract a number of supplementary questions. Is not that so?

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

I am grateful to the hon. Member. Of course that is a factor.

Photo of Mr Arthur Palmer Mr Arthur Palmer , Bristol Central

You said that 10 minutes had been given to supplementary questions, Mr. Speaker. In fact, most of the time was taken up by statements from the two Front Benches, and it was impossible for back benchers to put questions.

Photo of Mr Selwyn Lloyd Mr Selwyn Lloyd , Wirral

If I said that, it was not what I meant. I meant that 10 minutes had been devoted to the Question. I think that that is accurate.