Scot.E3

The UK North Sea as a Global Experiment in Neoliberal Resource Extraction

The UK’s North Sea oil tax regime, which has handed super-profits to international oil companies while the taxpayer now foots the bill for decommissioning, is forensically analysed in this article by Juan Carlos Boué, published by Scot-E3.

Boué argues that, since the 1970s, these tax arrangements have been “at the forefront of the process of redefinition of the economic frontiers of the State”. These “neoliberal governance structures”, designed in the UK, were exported across the world in the 1980s and 1990s, along with privatisation and “market liberalisation”. The global spread of the UK governance model did produce oil production gains, Boué concludes, “but also destabilised many key petroleum producers, whose governments found themselves starved of fiscal income”.

Boué also brings the story right up to date, showing how, as North Sea oil production declines, the government has pushed the burden of decommissioning costs on to the public purse, while the oil companies eke out every last drop of oil, and of profit, from their operations.

Boué’s article is very relevant to labour organisations and environmentalists seeking a “just transition” away from oil, that will help to tackle dangerous climate change by ending production, but also protect the livelihoods of communities that for the last two generations have been dependent on oil.

“Just transition” implies that money made from oil should be used to prepare those communities for a future without oil. Boué’s analysis is timely, because he not only dissects the tax rules that have so effectively mis-directed funds into company coffers, but shows how and why they were put in place.

Boué is exceptionally well qualified to write on these matters, having spent his professional life in the oil and gas sector, and worked as an academic researcher of the industry and as counsel at an international law firm. This publication by Scot-E3 is supported by PCS, the civil service trade union, and Platform London, the campaigning non-governmental organisation.  Download the PDF.

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Introduction to this site

ScotE3 (Employment, Energy and Environment) was initiated by a small group of rank and file trade unionists (mainly working in construction and defence) and climate activists  keen to find a way of taking climate action into workplaces and working class communities. We were inspired by the Million Climate Jobs programme for a transition to a sustainable economy and by the struggles for just transition taking place in working class and indigenous communities in the US and elsewhere.

For up to date information on events and discussion articles do check out the blog.  For background information in the form of  briefings on a wide range of topics relevant to climate action go to the resources page.  All our briefings are published under a Creative Commons License that means you can download, use and adapt provided you acknowledge the original was published on this site.

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What we’d like you to do

This year, with COP26 taking place in Glasgow in November, we want to take the message of climate jobs, just transition and the need for urgent action into workplaces, union branches, community groups all over Scotland.  Just get in touch via  the email form on the Contact Page and we will be very happy to arrange for a speaker or to send hard copies of relevant resources.

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