Protecting the supply chain that fuels tomorrow
For 60 years, the UK’s oil and gas supply chain has been nothing short of world-class. Forged in the challenging North Sea environment, it has evolved into a powerhouse of engineering excellence, a safety-first culture, cutting-edge technology, and a workforce that is the envy of the world.
Today, that same supply chain is perfectly positioned to help deliver both energy security and the net zero transition. Its capabilities - in project management, offshore operations, subsea engineering, logistics, and more - are directly transferable to offshore wind, hydrogen, and carbon capture. It is one of the UK’s strongest cards to play in the energy transition.
But instead of being strengthened, it’s being pushed to the edge and jobs are being lost as a result.
The latest findings from the Aberdeen & Grampian Chamber of Commerce’s 41st Energy Transition survey reveal a sector in stagnation. Since 2022, the proportion of oil and gas activity versus new energy work has barely shifted, despite government ambitions. This stagnation is not just an energy policy issue and it’s already having real consequences for employment and local economies.
As oil and gas projects decline without being replaced by low-carbon alternatives at scale, work is drying up and firms are looking elsewhere. By 2028, most expect the majority of their activity to be outside the UK, driven by falling project availability, unstable licensing policy and tax uncertainty. If these companies move operations abroad, they take investment, jobs, and expertise with them - weakening the entire UK industrial base.
The employment impact is stark. One-third of companies expect workforce reductions in the North East over the next five years, while 65% anticipate growing headcount overseas. Crucially, almost half believe that green energy roles will never fully replace the jobs lost in oil and gas. This isn’t a “just transition” - it’s a looming skills and employment cliff edge.
And the barriers to change are not just technical. Companies cite economic unviability, grid constraints, slow permitting, and stalled projects as key challenges. But the biggest long-term concerns are now home-grown: tax and licensing policy have overtaken global commodity prices as the top risks to their future.
Despite all this, nearly every firm surveyed agrees, the North East and the UK’s wider supply chain are essential to delivering a homegrown energy transition. The infrastructure, expertise, and people are already here.
The question is, will they still be here in five years?
One encouraging sign is the launch of a government-backed scheme to support oil and gas workers transitioning to green energy, with £900,000 available for the first round of applicants alongside an additional £40,000 from the Scottish Government.
That said, we must stop treating the UK energy supply chain as disposable. If we dismantle it now, we lose the very foundation we need to build the future. It’s time for smart policy, visible projects and long-term investment or we risk losing our competitive edge for good.
