Fuel and Power Industries

Part of the debate – in the House of Commons at 12:00 am on 10 March 1972.

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Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury 12:00, 10 March 1972

The prices I have quoted include costs of handling, transport, stocking, and perhaps rehandling. I said the figures are approximate and that they would vary from one part of the country to another. What costs they would include would depend upon what happens in transporting and handling coal. I would advise the hon. Gentleman that I am only trying to help the House by giving a guide as to the increase in the price of coal and the competitive disadvantage which it will suffer as a result of the increase in price.

Another point which must be taken into account in considering fuel policy is that it is not only the 7½ per cent. increase in the price of coal but the fact that there is going to be a subsidy to enable the National Coal Board to balance its books, and that is obviously a factor that my right hon. Friend will have to consider.

So there can be no doubt that coal is going to face very strong competition in the future as a result of recent events. But I would agree with hon. Gentlemen opposite in one thing—and I think it was the hon. Gentleman the Member for Bristol, Central (Mr. Palmer) who said this first—that much coal will be needed for a very long time to come; and also that insecurity of supply, which has become an added competitive disadvantage which coal now suffers from, would also be applicable to other fuels besides coal.

Therefore, I think I should consider some of the other fuels. It might help the House to confirm what has been said about the position in relation to them.

First of all, North Sea gas is an indigenous fuel and one entirely under our own control. The known and proved gasfields on the United Kingdom Continental Shelf are expected—so far as is known—to reach a yield by the middle '70s of 4,000 million cubic feet per day, which is the equivalent of about 15 per cent. of our fuel requirements and roughly equivalent to 60 million tons of coal. This is a very great benefit indeed.

I also confirm that the known discoveries are unlikely to last for more than 20 years, after which there will be a declining yield from the known gas-fields. I would emphasise that it is only 15 per cent. of our fuel requirements. Twenty years may see out most of us in the House today, but that is not a very long time in the history of the nation. I would say to my hon. Friend the Member for Harborough that these are hardly "huge reserves"—to quote from his Motion—and I do not believe it would be possible to step up their exploitation quite as he suggests, but I will not argue that at this stage, for this is the minimum, and what the maximum would be is not known. We may well find that there is a great deal more, but let us not, therefore, take firm decisions on fuel policy without more knowledge of this.