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Retired billionaire oil tycoon Sir Ian Wood, who was chairman and chief executive of the successful North Sea supplier Wood Group, was approached by the government in June to conduct a review of the industry.

 

His findings, published in an interim report on Monday, outline the opportunities and challenges facing oil and gas companies and the government and make a variety of recommendations designed to boost the economic benefit of the UK’s remaining offshore resources.

 

The report calls for a new regulator to be set up to oversee the sector as the current regulator is described as ‘significantly under resourced and far too thinly spread’ to manage the industry’s increasingly complex business and operating environment.

As envisaged by Sir Ian, the new regulator would take on a stewardship role for the next phase of the UK Continental Shelf (UKCS).

The body, which would be funded by the industry, would be appropriately resourced and armed with additional powers to achieve greater co-ordination of activities and collaborations.

For the first time, it would also have the right to attend operator consortia management meetings.

Sir Ian said: ‘A better resourced arm's length regulator with a strong economic focus, capable of attracting top quality personnel with appropriate industry experience, will be able to work more closely with the industry and facilitate the development and progress we need.

‘This will require fundamental changes in operator behaviour but, as my interviews confirmed, they are clearly up for it.’

Energy Secretary, Ed Davey hailed the report as a ‘once in a generation opportunity’ to boost the industry for another 30 years.

Scottish Energy Minister, Fergus Ewing lent his support to the recommendations made, saying the Scottish government was ‘fully behind Sir Ian Wood’s report’.

‘We believe it is essential that the recommendations are implemented with speed, and a shadow body be set up rather than await the outcome of primary legislation,’ he said.

However, director of environmental group WWF Scotland, Lang Banks criticised the report, saying that there is ‘something deeply worrying about publishing a report that aims to squeeze even more oil and gas out from beneath the North Sea just as delegates gather for UN talks to discuss ways to tackle climate change by reducing our dependency on fossil fuels.’