Paving the Path of a Prosperous Future
Offshore Energies UK (OEUK) recently unrolled a comprehensive strategy – “Harnessing the Potential” – outlining how the offshore energy supply chain can contribute not just to job growth, but also economic advancement and innovation across the United Kingdom. Developed by OEUK, in association with Robert Gordon’s University, this blueprint encapsulates the enormous potential that lies ahead.
The wider offshore energy arena, incorporating oil and gas operators and wind developers, could see an investment surge of up to £200bn in Britain’s energy and technology projects. This investment, slated for the rest of this decade, aims to contribute toward achieving government energy objectives.
Investing in Local Growth
If the roadmap is successfully implemented and both the government’s energy production and local content targets are reached, up to £90bn could be funneled into UK supply chain companies within the next ten years. The roadmap provides a detailed outline of necessary actions to be taken by the industry, government, and regulatory bodies from 2022 to 2035 to foster, facilitate, expand, and maintain UK abilities.
Opportunities highlighted within this strategy range from developing and licensing new technologies, manufacturing equipment, and maintaining and installing assets to ultimately decommissioning offshore energy projects.
Navigating Potential Pitfalls
This report has also brought to light significant challenges that may affect realizing these objectives, like the potential shrinkage of UK capabilities such as steel manufacturing and the volatility of investment due to fluctuating regulatory and fiscal conditions.
“Executing this robust roadmap and embarking on more energy projects domestically could unlock an immense £90bn worth of work for our offshore energy supply chain. Reaching a 100% delivery rate for these projects by UK companies could significantly enhance the prize,” said Katy Heidenreich, the OEUK Supply Chain and People director.
Evaluating Possible Outcomes
The new roadmap analyses the potential growth of the UK offshore energy supply chain through three different scenarios. The optimistic scenario envisages full implementation of the British Energy Strategy, with domestic supply chains dealing with 50% of the projects. Here, we see a potential for 50GW of offshore wind capacity, 10GW of hydrogen production, and 30 million tonnes of stored and captured carbon per year. Emphasis would be placed on favoring local oil and gas production over imports.
Conversely, the low investment scenario, which predicts no new development in oil and gas and slow-paced investment in new energies, promises only a £60bn investment in UK supply companies.
Despite varying outcomes amongst all scenarios, oil and gas are projected to offer the most significant supply chain opportunity until at least 2027.
“A nation boasting an illustrious maritime and industrial legacy, it’s perplexing as to why much of our energy manufacturing demands are met outside the UK. There are no simple choices as we forge forward, between oil and gas or renewable energy sources, as both are crucial to maintaining our energy supply and boosting the economy,” Heidenreich added.
