All 403 Labour MPs warned 'not to pull punches' on North Sea energy in urgent letter to back homegrown power

A “fundamental reset” is needed on energy policy, Labour MPs have been warned, including harnessing the full power of the North Sea.

The head of trade body Offshore Energies UK (OEUK) has written to all 403 Labour MPs, calling for them to back policies that promote homegrown energy, including oil and gas.

Chief Executive David Whitehouse says that the current approach is helping fuel a “second wave” of 1980s-style de-industrialisation.

Mr Whitehouse says in the letter that the UK is “at a major crossroads” as it waits for news on the next Prime Minister and warns that, when it comes to energy policy, “this is not a time for pulling punches”.

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OEUK represents almost 500 companies involved in North Sea energy, from oil and gas to renewables.

The letter, sent ahead of a major speech by Andy Burnham, states that, rather than shunning the fossil fuel market, the UK should increase domestic energy production “across the board”.

This would be showing climate leadership, Mr Whitehouse says, pointing out that North Sea oil and gas has a carbon footprint four times lower than imported liquefied natural gas (LNG).

Mr Whitehouse warns the politicians: “Business as usual on energy policy will not come close to meeting the challenge ahead. A fundamental reset is required. This is not a time for pulling punches.”

He said that successive Governments have failed to prioritise domestic production, meaning the UK now imports 40 per cent of the energy it needs. The expansion of renewables was “welcome and necessary”, he said.

“But with oil and gas still supplying around 75 per cent of our energy, it makes little sense to rely on imports rather than prioritising our own resources in the North Sea.”

Presently, new North Sea licences are banned. Operators are also subject to the Energy Profits Levy (EPL), or windfall tax, that sets an effective rate of 78 per cent of profits.

Work has stopped at both Rosebank, the UK’s largest untapped oil field, and Jackdaw, a gas field.

A legal challenge on climate grounds brought drilling to a halt and the decision on whether it can resume lies with Energy Secretary Ed Miliband.

Mr Whitehouse said he was not calling for greater consumption of oil and gas but rather policy that encouraged domestic production.

He writes: “Today, Government policy leaves us importing diesel and jet fuel refined from Russian crude oil, while refusing to prioritise our own oil and gas production over imports.

“Imagine how that feels to those working in the North Sea—and to the communities that depend on those jobs.

“Over the past 50 years, we have seen the erosion of British industry alongside a growing dependence on imported oil and gas—effectively offshoring our emissions instead of genuinely addressing the climate challenge.

“True climate leadership means demonstrating that decarbonisation can go hand in hand with economic growth and industrial strength, and net zero can be a driver of growth and industrial revitalisation.

“Yet for many communities, we have instead seen a second wave of deindustrialisation—a painful echo of the disruption and loss experienced in the 1980s.

“We are seeing an accelerated decline in production from the North Sea, driven by policy choices rather than geology.”

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Mr Whitehouse stressed that it wasn’t just offshore workers who were being affected. The trend of de-industrialisation, he said, “has real-world consequences for communities across the UK”.

“Domestic oil and gas production supports thousands of jobs, billions of pounds of value in our economy, the supply chain we need for the expansion of renewables, and it comes with a lower carbon footprint than imports,” he writes.

The OEUK estimates that with changes to the EPL and a freer approach to drilling, revenues of more than £13billion could come to the Treasury over the next decade. But the current policies make the UK an “outlier amongst its peers”.

He pointed out that Norway, which has a centre-left Government, issued 57 new oil and gas licences in January this year.

In Canada, Prime Minister Mark Carney has approved new pipelines and in Australia, PM Anthony Albanese’s Government has boosted domestic gas production, he says.

“We believe strongly that the UK should stand shoulder to shoulder with our friends in countries like Norway, Canada, and Australia – all environmentally responsible actors, but fully aware of the importance of domestic energy production for building industrial resilience and energy security,” he tells MPs.

“As you embark on deciding your new leader and future direction for the party and the country, we urge you to seize the opportunity to bring the UK into alignment with similar like-minded countries.

“This is about policy change.” He called for faster action on replacing the windfall tax with the Oil and Gas Price Mechanism, which is linked to wholesale prices. The change is currently due to take place in 2030.

He also said a “functioning regulatory regime” was needed, allowing work to resume at Rosebank and Jackdaw.

Mr Whitehouse said the revenue released from these moves would protect the country’s industrial base and could also be used to tackle issues such as fuel poverty.

“But this is about more than policy,” he writes. “Language matters. The debate around oil and gas has become too toxic, too polarised.

“It is wrong to divide our workforce into ‘clean’ and ‘dirty’ labour, into good jobs and bad jobs. That kind of dismissive language helps no one.

“This is not an argument for the status quo. We share the goal of Net Zero— but the reality is we need all energies on that path.

“This is the moment for a reset—one where Government adjusts not just its policies, but its language, and shows it understands and values the people who power this country.

“Our energy policy should champion renewables, support nuclear, and also back domestic oil and gas production—building a system that is secure, balanced, rooted in the UK’s own strengths, and that backs the communities whose jobs and futures depend on it.

“Back to a modern industrial Britain, secured by homegrown energy.”

A spokesman for the Department for Energy Security and Net Zero said: “Our priority is to deliver a fair, orderly and prosperous transition in the North Sea in line with our climate and legal obligations, which drives our clean energy future of energy security, lower bills, and good long-term jobs.”

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