**London**: Offshore Energies UK’s report reveals that 90% of offshore energy companies see better investment prospects abroad, raising alarms about the UK’s energy supply chain. The findings highlight concerns over declining domestic opportunities and stress the need for supportive energy policies to retain and grow the sector.
Offshore Energies UK (OEUK), the UK’s trade body for the offshore energy sector, has raised significant concerns regarding the future of the nation’s offshore energy supply chain. Their recent report highlights that an alarming nine out of ten companies in the industry perceive foreign markets as more favourable for investment and growth. This sentiment, which stems from a heightened sense of uncertainty and a perceived decline in the domestic business environment, signals potential risks to the UK’s energy supply chain, which encompasses oil, gas, renewables, hydrogen, and carbon capture and storage (CCS).
Katy Heidenreich, OEUK’s Supply Chain and People Director, emphasised the competitive landscape in which the UK operates, stating, “The UK is competing internationally for energy investment so it’s concerning that many offshore energy supply chain firms see more attractive opportunities to grow their business overseas.” Heidenreich outlined key steps that industry and government can take to position the UK as the leading choice for offshore energy supply chain companies, drawing attention to the need for energy policies that facilitate continued investment in both traditional oil and gas sectors while also accelerating the development of renewable energy.
The OEUK’s ‘2025 Supply Chain’ report underlines the importance of leveraging Britain’s unique industrial strengths in energy production as a means to stimulate economic growth and to maintain the sustainability and security of the UK’s energy system. The report particularly stresses the necessity of establishing a robust pipeline of projects, supported by pragmatic policies, to keep offshore energy companies anchored in the UK.
In light of these challenges, the report identifies several barriers that the industry currently faces, including low revenues from renewable sources and waning investor confidence. To counter these issues, OEUK advocates for initiatives aimed at enhancing collaboration across the supply chain, stressing the need for governmental support for the UK’s capabilities in offshore wind, hydrogen production, and CCS.
The UK’s offshore energy supply chain is described as an extensive network vital to the nation’s energy infrastructure, comprising hundreds of businesses that contribute throughout the lifecycle of energy production — from the installation of wind turbines and extraction of oil and gas to the decommissioning of offshore installations.
Heidenreich noted that approximately 60% of the survey respondents are diversifying into renewable sectors, such as offshore wind and CCS, yet underscored that revenues generated from these areas still represent a minor fraction of overall business turnover, typically ranging from zero to 20%. OEUK is currently participating in crucial government consultations regarding the future of the North Sea, focusing on various aspects from industrial strategy to fiscal regulations impacting oil and gas licensing.
The report also highlights the importance of harnessing oil and gas revenues to ensure the survival and growth of supply chain firms while advocating for an appealing commercial environment that is being bolstered by initiatives like alliance contracting and shared inventory systems. These efforts are intended to promote better cooperation among operators, developers, and contractors across the industry.
As the decisions made in the coming months are poised to shape the future of the North Sea, the OEUK stresses the critical need for an energy supply chain that not only supports the UK’s immediate energy needs but also positions the country as a leader in low-carbon technologies. Heidenreich concluded by stating, “The prize is a homegrown energy future, not one that is imported,” underlining the commitment to a more sustainable energy landscape that bolsters domestic capabilities.
Ultimately, Offshore Energies UK’s report urges a collective acknowledgement of the necessity to maintain and grow the supply chain within the UK, a strategy deemed vital in adapting to emerging energy opportunities and securing a sustainable future.
Source: Noah Wire Services
Subscribe to Industry Updates
