The state must step in to protect North Sea oil, which has reached a tipping point where fields could be prematurely mothballed, according to former Prime Minister Gordon Brown.
In one of his last major speeches before stepping down as an MP, Brown will call for public and private sector partnerships to provide investment in oil fields threatened with premature closure. He also call for tax reductions for the industry in the March budget.
"This is not a normal downturn where we can automatically expect a full recovery when prices rise. One budget initiative would be to recognise the tipping point we are at – the structural damage that could be done if fields are summarily abandoned – and create a North Sea reserve to maintain and upgrade essential infrastructure and to provide last-resort debt finance for companies who want to keep fields open," Brown will say.
"In the most extreme cases, to avoid the field being mothballed in its entirety, the government could go into partnership for a takeover of the field. If it is temporarily abandoned, the government should act to ensure that sometime in the future it is possible to come back and exploit the oil".
Brown wants the infrastructure of the fields kept open through a mix of public-private partnerships, loans and advance purchase agreements.
"Over 50 years, until last year, 42bn barrels of oil and gas have been produced. Anything between 12 and 24bn barrels of oil and gas remain, so between two thirds and three quarters of the oil has been extracted."
Meanwhile, Russian billionaire Mikhail Fridman has threatened legal action against the British government over its plans to block him from buying up North Sea gas resources.
Fridman's new energy conglomerate L1 Energy will incorporate the gas and oil assets of Germany's RWE, when it buys RWE Dea, in a deal worth €5bn which will be closed today. L1 Energy will be chaired by former BP chief Lord Browne.
However the Department of Energy and Climate Change has said it will block Fridman from acquiring the UK assets from RWE, the FT reported.
Energy secretary Ed Davey said there were fears over the effect any tightening of sanctions against Russia would have on UK oil and gas production. He said the companies' proposal to keep the North Sea fields separate from Fridman's other energy businesses for several years had failed to alleviate his concern over the possible effects on their "continued operation".