The trade-off between high pay and insecurity works only for a few. If our too willing acceptance of American business practices is leading to this bonfire of talent, then maybe it is time for us to think again.christopher.walker tiscali.co.uk. Vladimir Putin's visit to Britain last week gave a partial answer to the question, "What do we do when North Sea oil runs out?" Vladimir Putin's visit to Britain last week gave a partial answer to the question, "What do we do when North Sea oil runs out?" It is: "Buy it from Russia." The pipeline deal signed last week will bring Russian gas supplies here to replace North Sea gas, rather than oil. Still, it gives a clear signal why the UK and Russia are likely to be bound together commercially for many years to come.It is true that North Sea oil and gas won't run out completely for many years. While it seems unlikely that there will be any huge new discoveries, extraction technology is advancing all the time, with the result that companies are finding ways of getting more out of existing fields.
So what will happen is a slow decline rather than a sudden stop. We are, however, reaching the start of that decline for both gas and oil.Last year the UK still ranked as one of the top 10 oil producers in the world - just. More remarkably, it was also number four in the world gas league (see the graphs above). But at present production levels, as the new BP Statistical Review of World Energy shows, Britain has just 5.8 years of proven oil reserves left. In gas, the ratio of reserves to production is not much larger: 6.8 to one.
Russia, by contrast, has 22 years of oil and more than 80 years of gas at present production levels.So you can see the way things will go. Britain, like the rest of Europe, will become more and more dependent on Russia for its gas. We will also have a powerful incentive to help Russia increase its oil production, so it can become an alternative source of oil should the Middle East become even more unstable than it is now.This prospect raises at least three big questions. First, and most obvious, is there a general energy crisis looming?I think the answer to that is no, or at least not yet. The ratio of production to reserves both of oil and of gas has been remarkably stable in recent years. Oil remains at about 40 years' supply, gas at 60 (see the graph on the right).
