11:30 The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)

It is a great pleasure to serve under your chairmanship for the first time, Ms Ryan. I am pleased to open the debate on the regulations, which will transfer certain functions relating to the licensing and taxation of oil and gas from the Secretary of State for Energy and Climate Change to the Oil and Gas Authority. With the recent debate on the Energy Act 2016 no doubt still fresh in hon. Members’ minds, I am sure that most will be familiar with the background to the establishment of the OGA and Sir Ian Wood’s review into maximising the economic recovery of petroleum from the UK continental shelf. However, for the sake of coherence, I will outline briefly where we have got to.

The OGA has been established as an Executive agency of the Department of Energy and Climate Change and has made great progress. The successful passage of the Energy Act enables the OGA to be set up as a Government company and empowered with a broader range of tools to meet the challenge of MER UK, as envisaged by the Wood review. A central part of the establishment of the OGA is the transfer to it of essential functions currently exercised by the Secretary of State.

The rationale for transferring those functions to the OGA is the same as for transferring the functions transferred by the Energy Act: the effective establishment and operation of the OGA as regulator and asset steward of the UK continental shelf. The only difference in this case is the legislative vehicle by which the functions are formally transferred. It is worth noting that, as with the functions transferred by the Energy Act, the functions that will be transferred by the regulations are all currently being exercised by the OGA in its capacity as an Executive agency of the Department of Energy and Climate Change. However, once the OGA is established as a Government company, it will be legally distinct from the Department. In order to continue to carry out its functions, they will need to be formally transferred to it.

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11:35 Barry Gardiner (Labour)

I regret that the Government have abandoned their funding for the development of the CCS programme. I think that is a devastating shame. We have the finest repositories in the world and they are going to be there awaiting CCS technology. Although, in terms of our own emissions reduction capacity and our own climate commitments, CCS is not critical for our infrastructure in the immediate future, it could have been marketed across the world through the technology and skills that Britain could have exported. For that reason, I regret the loss of funding. However, it does not give me cause to detain the Committee longer or to press the matter to a vote.

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