Wytch Farm

Oral Answers to Questions — Energy – in the House of Commons at 12:00 am on 28th March 1983.

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Photo of Mr Ted Rowlands Mr Ted Rowlands , Merthyr Tydfil 12:00 am, 28th March 1983

asked the Secretary of State for Energy whether he will make a statement on the disposal of the British Gas Corporation's Wytch Farm interests.

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

I shall do so when the current negotiations have been concluded.

Photo of Mr Ted Rowlands Mr Ted Rowlands , Merthyr Tydfil

Is it not an utter scandal that the Secretary of State and the Government are attempting to destroy the fine partnership between the British Gas Corporation the British Petroleum, which has developed the best offshore oilfield that we have? Will the right hon. Gentleman tell us a little more about the current negotiations, and in particular what part he has played in them? We have been told time after time that this is a commercial decision by the British Gas Corporation. Why have the right hon. Gentleman and his Department been having secret meetings with some of the bidders to control them so that they present an acceptable bid?

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

The principle of the matter has been debated in the House on several occasions. It has been voted on, Parliament has decided and it is now up to the British Gas Corporation to carry out the will of the House of Commons and Parliament. The British Gas Corporation sought my guidance on the bids that it received, and in formulating that guidance it was necessary for me to seek some elucidation of the bids.

Photo of Mr Ted Rowlands Mr Ted Rowlands , Merthyr Tydfil

This has been a very important revelation, because time after time Ministers have said that this is nothing to do with the Government, and everything to do with the British Gas Corporation. Which bidders has the right hon. Gentleman met? Did he ask the British Gas Corporation to meet the bidders, or did he seek to meet them in order to achieve an acceptable bid?

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

The British Gas Corporation is well aware of the part that I have played. It explicitly sought guidance from me about the bids that it received and I have acted in a wholly even-handed manner.

Photo of Mr Nicholas Budgen Mr Nicholas Budgen , Wolverhampton South West

Does my right hon. Friend agree that it is well understood in the west midlands that the Government wish to dispose of Wytch Farm and to encourage exploration in the North sea, but that those who are dependent upon lower oil prices would not wish the Government to give the impression that they can influence the price of oil so as to keep it up and would much rather that the Government state more clearly that the price of oil is dependent upon market forces?

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

I do not know whether my hon. Friend was in the Chamber when I answered question 3. If he had been, he would have heard me say precisely that. BNOC sells the oil that passes through its hands at the best prices that it can get in the market.

Photo of Mr John Smith Mr John Smith , Lanarkshire North

The Secretary of State made an interesting statement a few seconds ago. He said that he had been even-handed towards the bidders for Wytch Farm. Has the right hon. Gentleman met all the bidders?

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

I have met all the bidders whom the British Gas Corporation considered to be valid.

Photo of Dr Dickson Mabon Dr Dickson Mabon , Greenock and Port Glasgow

Will the Secretary of State give us an assurance that he has put no pressure on the British Gas Corporation to reduce its valuation of Wytch Farm? Can he assure us that the valuation is a proper one, given by a nationalised industry acting in the nation's interests? Whatever conversations the right hon. Gentleman has had with the bidders, can he say that in the last analysis he cannot refuse British Petroleum if it wishes to buy Wytch Farm?

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

The right hon. Gentleman is right to say that BP has a matching right. The only independent valuation of which I am aware is that produced last month by the distinguished oil analyst, Wood Mackenzie and Company, which put a value of between £141 million and £213 million on the BGC's interest.

Photo of Mr Timothy Eggar Mr Timothy Eggar , Enfield North

Has not the British Gas Corporation been seeking deliberately to try to frustrate the will of Parliament, which was clearly that that share should be sold? It is not quite unreasonable for it to have behaved as it has in artificially inflating the value of its stake in Wytch Farm.

Photo of Mr Nigel Lawson Mr Nigel Lawson Secretary of State for Energy

My hon. Friend has a good point. As I said earlier, Parliament has decided the matter and it is up to the British Gas Corporation to carry forward the decision expeditiously.

Photo of Mr Ted Rowlands Mr Ted Rowlands , Merthyr Tydfil

On a point of order, Mr. Speaker. In view of the outrageous and disgraceful statement by the Secretary of State, I give notice that I wish to raise this matter on the Adjournment.

Photo of Mr George Thomas Mr George Thomas , Cardiff West

I must ask hon. Members to use the usual formula when giving notice.