This obsession with green energy is making Britain UNINVESTABLE: JIM JOHNSON

Every day, I look at the extraordinary saga of the Rosebank and Jackdaw oil and gas fields in the North Sea and shake my head.As chief executive of Hunting, one of Britain’s oldest engineering companies servicing the oil and gas sector, seeing these two enormously valuable sources of home-grown energy stranded beneath British waters – not because they cannot be reached, but because ministers cannot decide whether they should be – has been a source of frustration for much of the two decades since they were discovered.But never more so than today, as millions of British households contemplate yet another painful rise in their energy bills after regulator Ofgem raised its price cap by 4 per cent, taking the average annual bill to £1,723.The reason, we are told, is the ongoing conflict in Iran and the resulting turmoil in international energy markets.And that may be true – but it does not tell the whole truth. For while the conflict has undoubtedly affected wholesale prices, the reality is that the war has exposed Britain’s vulnerability; it did not create it.That vulnerability was made in Westminster, via a series of catastrophic policies based on a wilful denial about how this country keeps its lights on.Among them are swingeing taxes – today, the headline tax rate on North Sea oil and gas profits is an astonishing 78 per cent – a refusal to issue new exploration licences and an apparent determination to leave vital projects such as Rosebank and Jackdaw trapped in regulatory limbo which has made the country increasingly dependent upon imported energy.The result is not only a catastrophic failure to protect the country’s energy supplies – as we have seen in recent months, with a conflict thousands of miles away sending prices soaring – but a country which, in the eyes of many international businesses, is now uninvestable. BP remains captive to what can only be described as the cult of Net Zero, the pursuit of which has become akin to a religion in this country, writes Jim JohnsonSadly, I can testify to this from painfully close quarters. In recent years, we have taken the very difficult decision to greatly reduce our UK presence, shutting four of our six UK operating sites, shedding dozens of highly skilled jobs. Today, alongside our 30-strong London head office, we only have a manufacturing facility at Badentoy, Aberdeen, and a recently purchased business in Ashington, Northumberland.We still value the extraordinary workforce and engineering expertise Britain possesses. But the reality is that, as a global business, we have to make relative decisions when it comes to where we invest. Capital is not patriotic – it goes where it is welcomed and respected.I take this personally. In the Nineties, I spent four wonderful years working on the ground in the North Sea out of Aberdeen, the birthplace of Hunting’s modern oilfield services business. We employed many hundreds of people there. Aberdeen was a place of ambition and invention, home to a once world-class industry now decimated by government policy.It is not just Hunting. One of our biggest customers was the American energy company Apache – until, in 2023, it suspended drilling in the North Sea, blaming the increasingly burdensome tax regime. It subsequently announced that it would end North Sea production altogether. Now BP has put its entire UK North Sea oil and gas business up for sale, potentially bringing to an end more than 60 years of production in its home country. Earlier this month, it announced plans to develop a large offshore gas field in Venezuela.You might imagine that the decision of a once proudly British company to retreat from British waters while pursuing projects overseas would serve as a wake-up call to ministers. Far from it. Instead, they remain captive to what I can only describe as the cult of Net Zero, the pursuit of which has become akin to a religion in this country.Let me be clear: energy companies are not indifferent to climate change and the industry has invested enormously in making production cleaner and more efficient.But environmental ambition must be reconciled with another goal: improving people’s standard of living. A policy that closes factories, destroys jobs, weakens the tax base, drives investment abroad and leaves families paying more for energy cannot be considered an unqualified success.Especially since the reality is that for all the green banner wavers, Britain still obtains the majority of its energy from fossil fuels (last year, it consumed roughly 70 billion cubic metres of gas and 60 million tonnes of oil). What has changed is that, because North Sea production has been allowed to decline, an ever-growing proportion must be imported.This is the great deception at the heart of our Net Zero debate. Britain may congratulate itself on reducing emissions within its borders, but it is still importing the same hydrocarbons from abroad, sometimes from countries operating under environmental standards far below those of the UK – whose offshore production, alongside Norway, is among the most tightly controlled in the world. Imported energy must also be transported, adding further emissions and costs.Nor is it true, as is so often suggested, that Britain has run out of oil and gas. There remains substantial potential beneath UK waters. Technology advances, allowing companies to extract reserves once thought uneconomic or inaccessible.What politicians fail to grasp is that this is not a choice between oil and gas for ever and a transition to cleaner energy. It is a question of whether that transition is affordable and grounded in reality, or whether they destroy the foundations of the economy in pursuit of arbitrary targets.A modern industrial nation needs abundant, reliable and competitively priced energy. Energy is not simply another sector of the economy: it is the foundation upon which every other sector depends.The tragedy is that Britain once understood this. Hunting was founded in 1874 as a shipping business. At the turn of the 20th century, our founder, Charles Hunting, expanded into the emerging oil trade and ordered one of the world’s first purpose-built bulk oil tankers.During the Second World War, the company manufactured fuselages and tail frames for heavy bombers including the Lancaster. Today, we use advanced engineering to make high-pressure equipment for subsea oil and gas wells, as well as precision components for aircraft and spacecraft.We have spent more than 150 years adapting to changing global demands. But no company can adapt to a government that makes investment irrational.Ministers talk about rebuilding British industry, improving living standards and shielding households from volatile international markets. Yet their energy policies work against every one of those goals.Jim Johnson is chief executive of Hunting.