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The debate has clearly expressed the concern felt throughout the House on the subject. It has highlighted our feelings about the treatment not only of adults but of children, who, as many of us feel, should be considered as persons in their own right, in accordance with the United Nations convention. Of course, we all want a just and humane system. The Minister enunciated some wonderful principles, but I noticed that she did not move very far from the rather hard line taken by Governments over a long period. In particular, she did not respond to me on the urgent and serious matter of destitution. I have no doubt that we shall have to come back to that.

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I look forward to the Government’s proposals, which will appear in the new year, as I do to the work of the independent commission on migration and asylum. I hope that both pieces of work will concentrate on improving administration at every point along the line and on incorporating best practice into how we administer these matters. Neither did I hear much about regularisation of those who are here illegally. I hope that that is something on which the Government will concentrate some effort. With these words and with deep gratitude, I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

Petroleum Act 1998 (Third Party Access) Order 2007

4.58 pm

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Truscott) rose to move, That the draft order laid before the House on 20 November be approved [Second Report from the Statutory Instruments Committee].

The noble Lord said: My Lords, the order before you makes certain amendments to the Petroleum Act 1998 and should be seen in the wider context of the UK’s security of supply and diversification of supplies agenda.

Noble Lords will be aware that earlier this week the order was debated in Committee in the other place. During that debate, the Minister of State for Science and Innovation reminded the Committee of the strategic importance of the Langeled South pipeline from Norway, which flowed first gas to the national grid in October this year. The pipeline has capacity to meet up to 16 per cent of the UK’s winter demand for gas and is a very welcome addition to the UK’s import capacity at a time when our reserves of oil and gas are declining. We are fortunate in having a long history of close partnership with the Norwegians, who have proven to be stable and reliable partners and suppliers.

The purpose of the order—the Petroleum Act 1998 (Third Party Access) Order 2007—is to make certain amendments to the Petroleum Act 1998. The amendments are consequent on provisions agreed in the 2005 UK/Norway framework agreement on cross-boundary petroleum co-operation and, in particular, provisions that relate to the Langeled South pipeline.

The 2005 framework agreement was an innovative umbrella agreement to streamline the processes for approving a variety of projects in the future, but it also laid down specific provisions in respect of this major gas pipeline to the UK. When we negotiated it, it was agreed that the Norwegian regulated access system, where shippers are subject to published tariffs and terms, would apply to the whole of the Langeled South pipeline, which forms an integral part of the Norwegian offshore gas pipeline network.

The regulated access system differs from the United Kingdom’s offshore system, where access terms are a matter for negotiation between individual shippers and the pipeline owner, with subsequent

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determination by the Secretary of State only if negotiation proves unsuccessful. The provisions in the framework agreement thus avoid the complexity of different access systems at points along the pipeline length.

There are safeguards built into the agreement that allow a measure of joint agreement between the Norwegian and UK authorities. In particular, both the Norwegian and UK authorities must agree on the entry tariffs charged to UK companies seeking access to the Langeled South pipeline and the points at which access is to be made to it. In addition, should a UK company claim that the terms of the Norwegian regulatory system are not being fully and properly complied with, the framework agreement provides for joint determination of the dispute by the UK and Norwegian authorities. The need for an amendment to our law to ensure that it is consistent with provisions agreed in the framework agreement was signposted in the Explanatory Memorandum that accompanied that agreement when it was laid before both Houses in May this year.

I shall take your Lordships through the key points of the order. First, it amends the Petroleum Act 1998 to remove any pipeline that, under the terms of the framework agreement, is to be subject to the Norwegian regulatory access system from the scope of Section 17F of the Petroleum Act 1998. That category includes Langeled South. In the absence of the amendment, Langeled South would have remained a controlled pipeline within Section 17F. As I am sure all noble Lords know, Section 17F makes provision for application to the Secretary of State for the right of access to pipelines on the UKCS following failure to agree between the person seeking access and the owner of a pipeline.

Secondly, the order establishes, under two new sections—17GA and 17GB—a new category of dispute that the Secretary of State, jointly with the Norwegian authorities, may resolve under the Petroleum Act 1998. The new sections provide that, where access to Langeled South has already been awarded to a third party under Norwegian regulatory rules but that third party subsequently claims that the owner or operator of Langeled South has not complied with the terms and conditions under which access was awarded, a determination is made jointly by the Secretary of State and Norwegian authorities.

The changes to the Petroleum Act 1998 are required before Her Majesty’s Government will be in a position to notify the Norwegian Government that all the internal procedures are complete and that the framework agreement can enter formally into force. The Norwegians have completed all their internal procedures. I therefore commend the draft order to the House and beg to move.

Moved, that the draft order laid before the House on 20 November be approved [2nd Report from the Statutory Instruments Committee].—(Lord Truscott.)

Lord De Mauley: My Lords, we welcome the order, and I thank the Minster for explaining it. It seems not only sensible but important.

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As the Minister says, at capacity, the Langeled South pipeline is capable of meeting some 20 per cent of our current gas requirements. It is good news that it will no longer be necessary to negotiate separate project-specific agreements. Equally, it is essential that the correct regulatory framework is put in place. As your Lordships would expect, therefore, I have a few questions for the Minister.

I would be grateful for clarification of the interplay between the Norwegian and UK authorities. The Explanatory Memorandum helpfully explains that, as things stand, the Secretary of State is entitled to determine third party access to controlled petroleum pipelines, but he may not act jointly with the Norwegian authorities. It goes on to say that the draft order provides for third party access to pipelines such as Langeled South to be determined under the Norwegian system rather than the UK one and for the Secretary of State to act jointly with the Norwegian authorities in determining disputes. Can the Minister explain in simple terms how the Norwegian access system will differ from the existing system? Why will the Secretary of State be involved at all, as set out in subsection (6) and subsection (8), which require him to determine applications jointly with the Norwegian authorities? In practical terms, it seems that he is inexorably going to have less control over time. In that context, what mechanism is there to resolve situations where he and the Norwegian authorities disagree?

I understand that the development of the pipeline project is headed by a joint Norsk Hydro/Statoil team, which I believe means that it is partly state-owned. As the Norwegian authorities will be regulating access, how will that potential conflict of interest be handled? What consultation has taken place over the order generally with the UK gas industry? Given the particular importance of the pipeline in contributing to the security of gas to this country, what progress is being made to increase the UK’s gas storage capacity, which is of course of equal importance to supply itself?

In looking forward to the Minister’s responses to these and other noble Lords’ questions, I confirm that we will not stand in the way of the order.

Lord Redesdale: My Lords, we also welcome the order, which, although it is called a petroleum order, is of course about a gas pipeline. The pipeline is going to greatly help the security of supply of gas to this country to the order of 20 per cent.

I have a question on one aspect of gas supply that is perhaps outside the order. Do we not need to increase onshore gas field supply security? Even with the Langeled increase in the supply of gas, we still have a very short supply of reserve gas.

Lord Truscott: My Lords, I shall respond immediately to the point mentioned by the noble Lord, Lord Redesdale: the new Langeled pipeline is today operating at around 60 million cubic metres per day—close to its full capacity of 70 million cubic metres. I also recently attended the opening in Bacton

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of the BBL line, a new source of gas for the country. In addition, we will be seeing the opening of new capacity in Teesside in the new year and later on in Milford Haven. There is going to be a considerable increase in gas storage capacity in the UK over the next few years. I think that I am correct in saying that we are doubling capacity between now and 2010.

I return to the points raised by the noble Lord, Lord De Mauley. The regulated access system differs from the UK’s offshore system, where access terms are a matter for negotiation between individual shippers and the pipeline owner, with subsequent determination by the Secretary of State only if negotiation proves unsuccessful. If there is a failure to agree on disputes, for example over access to Langeled, the framework agreement establishes a framework forum of representatives from the UK and Norway to exchange information and informally resolve disputes arising from the agreement. The agreement also establishes a conciliation board, to be used in the event that the framework forum is unable to agree a dispute, which also includes members from both states and a third country. Decisions of the conciliatory board are binding on both Governments. That is an example of the dispute framework being well worked out and quite comprehensive.

On other disputes and the question of whether the UK has given up powers to determine access terms, I would say that we have not given up all our powers of dispute resolution. With the Norwegian system, tariffs and terms are published, and in the framework agreement we agreed with the Norwegians that, in the unlikely event of a dispute with a UK third party as to whether the owners or operators of Langeled South had fully and properly complied with the terms and conditions in the regulated access system, the dispute would be jointly determined by both Governments along the lines that I have already suggested.

The noble Lord, Lord De Mauley, mentioned consultation. Oil and gas companies were fully consulted at the drafting stages of the agreement.

If I have inadvertently missed any questions, I shall write to noble Lords.

On Question, Motion agreed to.

Science and Technology Facilities Council Order 2007

5.10 pm

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Truscott) rose to move, That the draft order laid before the House on 20 November be approved [Second Report from the Statutory Instruments Committee].

The noble Lord said: My Lords, the purpose of the order is to establish a new Science and Technology Facilities Council under the Science and Technology Act 1965. The Act requires that a draft of the Order in Council declaring the Science and Technology Facilities Council to be a research council and specifying the new body’s objects must be laid before

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Parliament and approved by a resolution of each House of Parliament. The draft royal charter under which the new body will be incorporated has been placed in the Libraries of both Houses as background to this debate.

The aims of the new council will be: to create a more integrated approach to large scientific research facilities, including international negotiations, for long-term projects involving several countries acting together; to obtain more value from the knowledge and technologies that are developed as a result of the new council’s programmes; and to deliver those goals using the two science and innovation campuses at Harwell and Daresbury as identifiable knowledge-transfer centres that host UK-based large-scale international facilities.

The new council will be created by the merger of the activities of the Council for the Central Laboratory of the Research Councils and the Particle Physics and Astronomy Research Council and the transfer to it of the nuclear physics research activities of the Engineering and Physical Sciences Research Council. The proposal will give the council the scope to carry out those activities.

The proposals to create such a council were subject to public consultation following the 2006 Budget. There was wide support for the creation of a unified council dealing with the large facilities previously managed by the Council for the Central Laboratory of the Research Councils and the Particle Physics and Astronomy Research Council and for keeping the research and postgraduate training powers of the Particle Physics and Astronomy Research Council within the new council. That is how we propose to proceed—noble Lords will notice that we are not shortening the names of any of the research councils involved.

Professor Keith Mason, the chief executive of the Particle Physics and Astronomy Research Council, has been appointed as chief executive designate of the proposed new council and is leading the necessary transition work at the councils. I am grateful for the leadership he is providing. All the staff, assets and liabilities will be transferred from the existing councils concerned to the Science and Technology Facilities Council under the terms of a further order made under the Science and Technology Act 1965 using the negative resolution procedure. It is planned that the council will start work on 1 April 2007. I beg to move.

Moved, That the draft order laid before the House on 20 November be approved [Second Report from the Statutory Instruments Committee].—(Lord Truscott.)

Lord De Mauley: My Lords, I thank the Minister for introducing this order. We note that the Explanatory Memorandum states that,

despite the memorandum having stated earlier that only two-thirds of respondents were “broadly supportive”—

Can the Minister explain that justification more fully?

14 Dec 2006 : Column 1710

Among the risks acknowledged in the regulatory impact assessment of option 1, which has been adopted, is the risk that,

Could the Minister expand on what is being done to mitigate those risks?

As a matter of interest, should we not also expect administrative savings as a result of amalgamating the Council for the Central Laboratory of the Research Councils, the Particle Physics and Astronomy Research Council and the Engineering and Physical Sciences Research Council? I look forward to the Minister’s responses.

Lord Redesdale: My Lords, the Explanatory Notes for this order talk about the facility of providing funding for large-scale facilities. While we support such work as the Large Hadron Collider fission research taking place in France, might money going into this new research council be directed into such large projects overseas?

Lord Hunt of Chesterton: My Lords, this debate reminds me of my first lecture in Birmingham Central Library, talking about the importance of science. That evening was a bit like the House of Lords—the audience was zero, although we are a bit better than that here.

This is an important statement from the Minister, but one of the features of UK science is the limited degree of publicity supporting these major facilities. Recently we had the Mars Lander project. It is important that this new research council brings together both the science and the support of these big systems. This is a major part of demonstrating science and encouraging a greater involvement of science. The public education aspect of this new research council is important. That is part of its remit. Has the Minister any comments?

The Explanatory Notes had a rather different emphasis from the Minister’s remarks. He commented on these facilities being part of an international network, which I very much endorse, but the document focused on the United Kingdom. However, all these facilities operate effectively only when they are part of an international network. The EU has systems and large-facility integration, and transatlantic international and bilateral arrangements are important as well. My point, which has not been made elsewhere, is to repeat what I asked the noble Lord, Lord Sainsbury, four years ago. When you apply for a research grant in the UK, you have to comment on whether the research is going to add to economic development and quality of life, and my question was whether that involved just the UK or if it applied globally. The noble Lord, Lord Sainsbury, said emphatically that this was a global concern. Following that, there have been many research grants, which had been turned down, but which were allowed to proceed because they were focusing on global issues. All government remarks have been that all the big scientific issues are global. So the remarks made in the text—

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are narrower than the interpretation of the noble Lord, Lord Sainsbury, three or four years ago. Would the Minister like to comment?

Lord Truscott: My Lords, the noble Lord, Lord De Mauley, asked about the consultation. More than 120 responses were received by the close of the consultation on 16 June. Those in favour of the merger outnumbered those against by a margin of two to one, while the proposal to transfer PPARC’s grant-giving functions to the EPSRC were opposed by a margin of about three to one.

Has the whole exercise been about cost savings? No, it has not. We are seeking to strengthen the UK’s long-term position in access to large facilities. Research councils already have high-quality efficiency programmes, set up following the Gershon review, which will be unchanged by a decision to create the STFC.

The noble Lord, Lord Redesdale, and my noble friend Lord Hunt of Chesterton asked about European or other international commitments. The STFC will be a member of a number of major international collaborations—CERN, the European Laboratory for Particle Physics, the European Space Agency, the European Southern Observatory, the European Synchrotron Radiation Facility and the Institut Laue-Langevin. Involvement in all those enterprises will provide the organisation with access to research facilities essential to achieve its mission and will account for a sizeable part of its overall expenditure. The Government have responded to the European Strategy Forum on Research Infrastructures road map by asking Research Councils UK for advice on how the UK should get involved in such priority projects.

Will there be a representative of the particle physics, nuclear physics, space and astronomy communities? No decision has been made on that. The department aims to have members from a mix of backgrounds able to command the confidence of the science communities that it serves and to provide strategic direction to the new council. In essence, I can confirm again that this is not a cost-saving measure. The intention is that the council will have an important domestic and international role.

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