Retraining and decommissioning of offshore oil and gas installations could help support jobs for British workers, government report says. File Photo by Casey J. Ranel/USCG | License Photo
LONDON, July 6 (UPI) -- Training in related sectors, and work on decommissioning oil and gas projects could help keep the workforce healthy, a British policy paper said.
"The industry is currently facing an unprecedented period of difficulty in the face of continuing low commodity prices," a policy paper from the British government read. "Maintaining a vibrant U.K. oil and gas industry is critical [as] the industry is a key contributor to gross domestic product, to tax revenues, and an important source of exports."
A June report from industry group Oil & Gas U.K. showed jobs supported by the oil and gas sector since oil prices peaked at around $100 per barrel in 2014 have fallen by 120,000. Another 40,000 losses are expected by the end of the year even as oil recovers to the $50 range, after falling below $30 per barrel earlier this year.
According to the British government's report, nearly one in every 80 jobs in the country was supported in part by the oil and gas sector in 2014. With labor prospects dimming, the government said retraining oil and gas workers for other sectors could help given recent declines.
For the sector itself, the government's report said work could surface in decommissioning.
"The U.K.'s experience of being one of the first major offshore production basins anywhere in the world to reach maturity and begin the transition towards decommissioning puts it in an ideal place to become a world leader in this subsector, creating skilled jobs and employment," the report read.
By the government's estimates, about $22 billion in new spending could come from decommissioning through 2024, with most of that surfacing at the beginning of the next decade. The overall cost of decommissioning oil and gas projects could be up to $66 billion, the report said.
The report made no reference to the passing of a British referendum to leave the European Union. Bank of England Gov. Mark Carney warned it would "take some time" for the British government to reset its economic relations with the rest of the world.