What the growth in Scottish oil and gas exports means for Scottish independence

£8.2bn for 2011-2012.

Oil and gas industry exports in Scotland reached £8.2bn for 2011-2012, according to new figures released by the Scottish Council for Development and Industry. It is the fourteenth consecutive year of the growth in the sector.  

Beyond the sales of hydrocarbons, offshore equipment, construction and drilling services now account for almost half of sales around the world. Speaking at the Offshore Technology Conference in Houston, Texas, Scottish Energy Minister Fergus Ewing said:

“The Scottish Government recognises the substantial contribution that the oil and gas industry makes to our economy. We are working with the industry to continue to strengthen Scotland's position as a global leader in the sector and these figures mark further growth in this important part of our economy. There are huge opportunities open to us internationally, and we are determined to make the most of them.”

The biggest trading partner for Scotland remained North America, with sales reaching $4bn last year, an increase of 2.8 per cent. Sales to Africa came in second, growing 5.9 per cent for the year. Other growth markets are also being targeted by the industry, but according to Danny Cusick, President, Americas, Scottish Development International, North America will remain the country’s number one priority for the foreseeable future:

"While other markets such as Brazil, Africa, the Middle East and Australia are increasingly becoming international priorities for Scotland, North America remains by far our top and most important region for exports. Continued investment by oil and gas companies from the U.S. and Canada is crucial to Scotland's long-term economic growth."

Supporting nearly 200,000 jobs in Scotland, plus an estimated 24 billion barrels of oil still to be produced from the North Sea, the national government’s support for this industry will add further fuel to the Scottish independence debate. The announcement comes after first minister Alex Salmond last month tried to bolster the case for independence by predicting a mini oil boom worth £57bn in tax revenues by 2017-18, but was quickly accused of cherry picking optimistic forecasts by his opponents.

However, with this latest announcement, plus the UK government’s Department of Energy and Climate Change predicting oil prices of more than $150 a barrel by 2020, Salmond’s detractors could yet be proved wrong.

Photograph: Getty Images

Mark Brierley is a group editor at Global Trade Media

Photo: Getty
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Can Philip Hammond save the Conservatives from public anger at their DUP deal?

The Chancellor has the wriggle room to get close to the DUP's spending increase – but emotion matters more than facts in politics.

The magic money tree exists, and it is growing in Northern Ireland. That’s the attack line that Labour will throw at Theresa May in the wake of her £1bn deal with the DUP to keep her party in office.

It’s worth noting that while £1bn is a big deal in terms of Northern Ireland’s budget – just a touch under £10bn in 2016/17 – as far as the total expenditure of the British government goes, it’s peanuts.

The British government spent £778bn last year – we’re talking about spending an amount of money in Northern Ireland over the course of two years that the NHS loses in pen theft over the course of one in England. To match the increase in relative terms, you’d be looking at a £35bn increase in spending.

But, of course, political arguments are about gut instinct rather than actual numbers. The perception that the streets of Antrim are being paved by gold while the public realm in England, Scotland and Wales falls into disrepair is a real danger to the Conservatives.

But the good news for them is that last year Philip Hammond tweaked his targets to give himself greater headroom in case of a Brexit shock. Now the Tories have experienced a shock of a different kind – a Corbyn shock. That shock was partly due to the Labour leader’s good campaign and May’s bad campaign, but it was also powered by anger at cuts to schools and anger among NHS workers at Jeremy Hunt’s stewardship of the NHS. Conservative MPs have already made it clear to May that the party must not go to the country again while defending cuts to school spending.

Hammond can get to slightly under that £35bn and still stick to his targets. That will mean that the DUP still get to rave about their higher-than-average increase, while avoiding another election in which cuts to schools are front-and-centre. But whether that deprives Labour of their “cuts for you, but not for them” attack line is another question entirely. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

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