Offshore Energies UK’s 2025 Supply Chain report says building on the UK’s unique industrial strengths in energy production is key to unlocking the Government’s ambition to grow the nation’s economy and build the future of the North Sea.

Drawing on over 50 years of successful North Sea oil and gas operations, the offshore energy industry’s supply chain has the potential to power the UK’s drive to produce secure, sustainable and ever cleaner energy.

But without a pipeline of projects enabled by pragmatic policy to anchor them here in the UK, OEUK’s sentiment survey reveals nine companies out of every 10 see more attractive opportunities to grow their business overseas due to uncertainty and a less positive business environment at home.

The report sets out the barriers the industry faces including low revenues from renewables and declining investor confidence while outlining the actions both industry and government can take to ensure a homegrown energy future. It sets out key steps industry and government can take to anchor world class offshore energy companies in the UK.

These include industry initiatives aimed at fostering better collaboration across the supply chain plus moves to ensure that government champions the UK energy supply chain capability in offshore wind, hydrogen, and carbon capture and storage (CCS).

Forming an extensive and vital network across the country from Shetland to Southampton and from Morecambe Bay to the Eastern Seaboard of England, the UK’s offshore energy supply chain comprises hundreds of businesses supporting the industry throughout its lifecycle.

As an integrated ecosystem, this supply chain delivers products and services to energy producers and includes FTSE 100 companies as well as small to medium enterprises developing new technologies and providing specialist capabilities. It encompasses companies involved in designing mooring systems, manufacturing specialist valves, installing high voltage subsea cables, maintaining pipelines transporting energy and carbon plus those skilled at removing offshore structures from the seabed with many developing global leadership in floating offshore wind and decommissioning.

Katy Heidenreich, OEUK’s supply chain and people director, says: “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. We’ve set out key steps industry and government can take to position the UK as first choice for the offshore energy supply chain companies.

“To grow the whole UK’s economy, we need energy policy that supports continued investment in homegrown oil and gas alongside an acceleration of renewable energy. This must be addressed, and we are working with our members to bring positive solutions to the table.

“It’s good to export our expertise but that should never come at a cost to work we need to get done in the UK. Around 60% of companies surveyed for the report are diversifying into offshore wind, hydrogen and carbon capture and storage but business revenues from renewables and CCS still represent a relatively low proportion as they make up between zero and a fifth of their turnover.

“OEUK is currently engaging with critical government consultations on the future of our North Sea from industrial strategy to oil and gas licensing, environmental impact and a new fiscal regime. It’s vital we get this right to create a positive business environment in the UK for our supply chain.

“The offshore energies industry supports the sectors Britain needs to build its future. Steel, cement, ship building, glass, car making and many more rely on the energy and technologies we produce, including carbon capture which can offset and futureproof their energy-intensive operations. With between 60-80% of the capabilities required to lead the energy transition to net zero emissions, our companies and highly skilled people are committed partners in delivering secure, and affordable homegrown energy.

“The UK government is rightly ambitious to develop the clean power capabilities to support its industrial strategy, but this goal must be delivered in a way that builds our supply chain capability. The prize is a homegrown energy future, not one that is imported.”

Current challenges highlighted by the OEUK’s report include harnessing oil and gas revenues from the UK’s still significant reserves so supply chain companies can survive and thrive.

The report outlines how initiatives including alliance contracting, shared inventory systems and a drive to promote good procurement practice, are supporting efforts to create an attractive commercial environment. These are helping operators, developers, major contractors and suppliers of all sizes work better together.

OEUK’s report comes as decisions made in the coming months will not only shape the North Sea’s future but also its ability to unlock investment in low carbon technologies while continuing to deliver the energy security the UK needs. It highlights that there must be collective recognition that a sustainable future is one that enables companies to remain anchored in the UK while adapting and growing as new energy opportunities arise.

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