PwC on Brexit: O&G industry will show resilience

PwC, audit, assurance, tax and consulting services firm, commenting on the implications on the oil and gas business of the Britain’s decision to leave the EU, expects the industry to be less impacted by the referendum results.

Alison Baker, PwC’s UK and EMEA oil and gas leader, said:  “The oil & gas industry is a global business and as a result should be less impacted by today’s EU referendum result. We’ve seen the industry, both here in the UK and further afield, demonstrate its resilience in dealing with volatility and uncertainty through the past and current oil price shocks – and we are convinced that they can do so again.”

However, Baker said there will be some hurdles on the road ahead. She said that any further downturn in the economy or volatility in the oil price could cause further distress in the sector and in particular further project sanction deferrals might have significant consequence for the service sector who also rely on mobility of employees around the world.

“It will be vital for Government, OGA and Industry to accelerate the level of collaboration over the coming weeks and months to ensure that together we can work through this additional layer of uncertainty,” Baker added.

Offshore Energy Today has contacted oil and gas majors Shell and BP seeking comment on the Brexit vote. You can read their comments here: https://bit.ly/28PGZe8

Oil & Gas UK, a body representing the oil and gas companies in the UK, said it respects the democratic decision of the UK people and is ready to move forward. The organization has asked that the UK Government to clearly outline the process which will follow “to minimize any potential period of uncertainty.”

Energy Trilemma

Steve Jennings, power and utilities leader at PwC, said: “Many will applaud the opportunity to remove perceived European “red tape”. However, this is likely to take considerable effort at a time when the industry has other pressing issues to address, namely achieving a secure supply, decarbonising our energy industry and delivering electricity and gas at affordable prices.

“Tackling the energy trilemma will undoubtedly be more challenging without the support of a European-wide energy system with ready access to European sources of capital and talent.”