North Sea Oil (Refining)

Oral Answers to Questions — Energy – in the House of Commons at 12:00 am on 11th June 1979.

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Photo of Michael Spicer Michael Spicer , Worcestershire South 12:00 am, 11th June 1979

asked the Secretary of State for Energy whether he is satisfied with the capacity of the British oil refining industry to refine North Sea oil.

Photo of Mr Hamish Gray Mr Hamish Gray , Ross and Cromarty

The capacity of the British oil refining industry is more than sufficient to refine our current North Sea production. However, this would not be the cheapest way of meeting our demand for refined products, nor, because of the composition of North Sea oil, could it supply all of them. That is why we use a mixture of indigenous and imported crudes. The economics of British refining will be improved by current investment in plant to convert some less valuable heavy products into more valuable lighter products such as petrol.

Photo of Michael Spicer Michael Spicer , Worcestershire South

Have the Government any specific measures in mind to encourage the oil industry to increase its refining capacity to provide more North Sea oil in this country?

Photo of Mr Hamish Gray Mr Hamish Gray , Ross and Cromarty

My hon. Friend raises an interesting point. The most important point of all is to increase confidence in the industry and this, by future Conservative policies, we hope to do.

Photo of Mr Jeff Rooker Mr Jeff Rooker , Birmingham, Perry Barr

Will the Minister state what is Government policy towards the construction of independently operated oil refineries such as that proposed at Nigg Bay?

Photo of Mr Hamish Gray Mr Hamish Gray , Ross and Cromarty

The Government have not taken any view on such a subject but would obviously consider every issue on its merits.

Photo of Sir Peter Emery Sir Peter Emery , Honiton

While dealing with refining, will the Minister say whether he or the Secretary of State have been able to obtain assurances from the international oil companies that they are not cutting supplies of crude oil into British refineries by more than 5 per cent.?

Photo of Mr Hamish Gray Mr Hamish Gray , Ross and Cromarty

My right hon. Friend has had regular meetings with representatives of the major oil companies, and I can give my hon. Friend that assurance.