Sector Data

The extractive industries in the UK comprise oil and gas production, mining and quarrying. These sectors play a major role in the UK economy, contributing an estimated total of £13 billion Gross Value Added in 2020, down from £22 billion in 2019, and employing some 60,000 people directly, with many more supported in the industries’ wider supply chains.

The extractive industries comprise mining and quarrying, including oil and gas production.

The sector has made a sizeable contribution to the UK economy for many years and remains an important sector, both directly and by supporting substantial added value in downstream industries and related supply chains. By far the largest economic contribution comes from oil and gas production.

In 2020, total UK extractive industry gross value added (GVA) is currently estimated to have been £13 billion, down from £22 billion in 2019, with oil and gas production and associated support service activities accounting for almost 85% of the sector’s GVA [1]. 

Construction minerals, principally crushed rock and sand and gravel aggregates, represent the largest materials flow in the UK. The market for these minerals depends upon the level of UK construction activity and longer-term construction-related demand.

Although payments made by coal mining companies are no longer considered material relative to overall government revenues and to UK EITI reporting the continuing economic contribution of the coal sector is still included in the background information set out below. 

In some of the summary information below, coal is grouped with oil and gas (for example where data are available for fossil fuels but not for other parts of the sector). However, for most of this chapter, oil and gas are treated separately from mining and quarrying, including coal. In addition, it should be noted that the phrase “mining and quarrying” as used in UK national statistics embraces the whole UK extractive sector including oil and gas production as well as coal production. Mining support services are also included in this sector. Some of the data reported below include those activities while other data exclude them.

Figure 1. Extractive Industry Gross Value Added 

 

Source: ONS, UK GDP(O) low level aggregates, 30 September 2021

The underlying data presented in Figure 1 above are available on request from the UK EITI Secretariat.

Value of the sector

Table 1 shows GVA for the main components of the mining and quarrying sector as reported in UK national statistics.

As noted above, this sector includes fossil fuel production, other mining and quarrying and mining support service activities, but excludes the value of products manufactured with extracted minerals. The table gives for each subsector its percentage share of total UK GVA for the most recent year. It also shows the whole sector’s GVA as a percentage of national gross domestic product (GDP) for each year [2].

Table 1. Gross Value Added (GVA) (£ million)
YearExtraction of crude petroleum and natural gasMining of coalOther mining and quarryingMining support service activities Total mining and quarrying including oil and gasTotal UK GVATotal UK GDPExtractives share of total GDP
 (A)(B)(C)(D)(E) = sum of (A)–(D)(F)(G)(E) / (G)
20169,2742181,6401,25112,3831,779,2922,016,6380.61%
201713,5632661,6121,18316,6241,872,4212,097,1430.79%
201819,4311741,8981,26422,7671,942,6192,174,3801.05%
201918,1842161,9161,33921,6552,017,3442,255,2830.96%
20209,8571651,94895712,9271,910,6962,156,0730.60%
%*0.51%0.01%0.10%0.05%0.68%100%  

* The percentages in this row are shares of total UK GVA for all industries in 2020.
Source: ONS, UK GDP(O) low level aggregates, published 11 November 2021, ONS, GDP at current prices – real-time database (YBHA), published 11 November 2021

The underlying data presented in Table 1 above are available on request from the UK EITI Secretariat.
 

The following tables give a finer breakdown of the sector in the latest recent year for which data are available to give a sense of the scale of activity in each subsector. Although the GVA data in the first table and the one above are sourced from official Office of National Statistics (ONS) data, they are not identical. Note that in value terms support service activities are almost entirely related to extraction of petroleum and natural gas.

Table 2. Mining and Quarrying (including Oil and Gas) – number of enterprises, GVA and employment costs in 2019
SIC 07 CodeDescriptionNumber of enterprisesApproximate gross value added at basic prices (aGVA)Total employment costs
  Number£ million£ million
06Extraction of crude petroleum and natural gas15515,5221,914
09.1Support activities for petroleum and natural gas extraction2262,7391,784
08.11Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate2171,024472
08.12Operation of gravel and sand pits; mining of clays and kaolin159852344
08.92Extraction of peat157124
08.93Extraction of salt88431
09.9Support activities for other mining and quarrying1913524
BMining and quarrying1,29720,4774,731

Source: Annual Business Survey, 24 June 2021

The sum of constituent items in tables may not always agree exactly with the totals shown due to rounding.                        

Note: Total employment - point in time and Total employment - average during the year are from the Business Register and Employment Survey (BRES).                             

Caution should be taken when combining financial data from the ABS with employment data from BRES due to differences in methodology.  

More information can be found in the ABS Technical Report.      

The underlying data presented in Table 2 above are available on request from the UK EITI Secretariat.

                                                  

Table 3. Number of businesses in the private sector and their associated employment and turnover, by number of employees and industry division, UK, start 2021
 Businesses numberEmployment thousandsTurnover
£ million
All businesses   
05 Mining of coal and lignite10**
06 Extraction of crude petroleum and natural gas9551423,397
07 Mining of metal ores240**
08 Other mining and quarrying790216,683
09 Mining support service activities3,370216,104
B Mining and Quarrying including Oil and Gas5,3655636,184
All employers   
05 Mining of coal and lignite10**
06 Extraction of crude petroleum and natural gas901322,932
07 Mining of metal ores0**
081 Quarrying of stone, sand and clay310186,065
089 Mining and quarrying n.e.c.1903564
08 Other mining and quarrying505216,629
091 Support activities for petroleum and natural gas extraction150165,219
099 Support activities for other mining and quarrying801433
09 Mining support service activities230175,652
B Mining and Quarrying including Oil and Gas8355135,213

Notes:

1. n.e.c. = not elsewhere classified; industrial classification follows UK SIC 2007
2. A * symbol replaces data that are deemed to be disclosive.
Source: Business Population Estimates 2021, BEIS, 7 October 2021, Tables 6 & 7

The underlying data presented in Table 3 above are available on request from the UK EITI Secretariat.
 

Government revenues

UK government accounts cover a financial year running from April to March rather than a calendar year, so most of the data on government revenues are of necessity on a financial year basis.

Where possible, calendar year data have (also) been provided. Oil and gas companies have a distinct tax regime, allowing identification of their extractive-related tax payments (and repayments), whereas mining and quarrying companies pay mainstream corporation tax. This means the data for extractive-related tax receipts from mining and quarrying companies cannot be separated out. Details on tax revenues can therefore be found in the separate upstream oil and gas in the UK chapter.

Section 106 payments are made (in England, plus equivalent payments made elsewhere in the UK) to local authorities relating to the granting of planning permission for mining operations to cover, for example, local road and infrastructure improvements. These are the only mandated social expenditure by extractive companies.

There are no non-monetary arrangements between extractive companies and the government in the UK.

Forecasts of UK government oil and gas revenues are published by the independent Office for Budget Responsibility (OBR). The OBR also publishes details of its underlying forecasts of oil and gas production, prices and expenditure broken down between exploration and appraisal, development capital expenditure, operating costs and decommissioning costs.

Table 4 includes environmental taxes paid by the UK extractive industries. These are not extractive-related so are not included in the reconciliation of payments and receipts.

Table 4: Environmental taxes paid by the UK extractives sector
£ million2014201520162017201820192020
Government revenue from energy taxes (incl. EU ETS)248227165176208nyanya
Government revenue from transport taxes4855514939nyanya
Government revenue from pollution and resource taxes345357408378370nyanya
of which Aggregates Levy282342354405375366396
Total Government revenue from environmental taxes602641640624602nyanya

The EU ETS is the EU Emissions Trading System

The Aggregates Levy was introduced in 2002 and is a tax on sand, gravel or rock that has been dug from the ground, dredged from the sea or imported into the UK. It is generally payable by the quarrying industry but can also apply when aggregate is removed in the course of infrastructure projects. More information is given in the Aggregates Levy Bulletin

nya = not yet available
Source: Environmental taxes in the United Kingdom (ONS, 3 June 2021)

The underlying data presented in Table 4 above are available on request from the UK EITI Secretariat.
 

Exports

The UK both imports and exports all types of mining and quarrying production but is generally a net importer of each type. Information on trade flows is given in the relevant sectoral sections.

The ONS produce UK Trade Statistical Bulletins each month, as well as quarterly UK Trade in Goods by Classification of Product by Activity. Gross extractives exports in 2020 as reported by ONS in September 2021 amounted to 3.1% of total UK gross exports by value.

 

 

Employment

Table 5 gives estimates of the total UK workforce jobs directly supported by the UK mining and quarrying sector including its major sub-sectors. It also shows the industries are typically capital- rather than labour-intensive and correspondingly represent a significantly smaller share of workforce jobs than of GVA. All extractive employment shown in this and subsequent tables is in the private sector.

Table 5. Estimates of United Kingdom extractive Industry workforce (in thousands)
YearProduction of oil and gasMining of coalMining of metal ores and other mining and quarryingMining support service activities*Total extractive industriesAll UK Industries
201617121246234,336
201714119245834,682
201814121276234,882
201914123246235,388
202015123226034,734
20200.04%0.00%0.06%0.06%0.17%100%

* Almost all of this is in support of oil and gas production

Source: ONS (September 2021), BEIS (July 2021)

The underlying data presented in Table 5 above are available on request from the UK EITI Secretariat.

Table 6 shows estimates of extractive industry employment in Great Britain (the UK excluding Northern Ireland) at a finer level of disaggregation than is available for the workforce jobs estimates for the UK.

Table 6. Extractive industry employment in Greta Britain and United Kingdom (in thousands)

Source: ONS, Business Register and Employment Survey (Table 2a last updated on 9 November 2021)

The underlying data presented in Table 6 above are available on request from the UK EITI Secretariat.
 

Table 7 shows the proportion of females in the workforce in recent years in the extractive sector and the economy as a whole. Shares in 1996, the first year for which comparable data exist, are also shown. The longer-term trend in female representation in the extractive sector is clear.

Table 7: Share of females in total workforce
 Coal,
oil and gas production
Mining of metal ores
and other mining and quarrying
Mining support
service activities
Total extractive industriesAll UK Industries
19968%4%10%7%48%
201618%17%13%16%48%
201724%16%12%16%48%
201824%16%14%17%48%
201920%18%13%17%48%
202020%13%16%16%48%

Source: ONS (September 2021)

The underlying data presented in Table 7 above are available on request from the UK EITI Secretariat.
 

Regional location of extractive industries

Extractive industry employment levels have fallen markedly from their historic peak decades ago, mainly due to the decline of the coal industry, but extractive-related activities still contribute significantly to local employment in a number of regions.

The broad geographic spread of employment in the UK extractive sector (including oil and gas and mining support service activities) in 2020 is illustrated in Table 8. The concentration of employment in Scotland reflects the dominance of the Aberdeen area in terms of oil and gas-related activity. While the importance of the sector for the Scottish economy is well known, the relatively high shares of activity in North East England, the East Midlands and Wales are also noteworthy.

Almost all extractives employment is full-time. In 2020, full-time employees engaged in oil & gas extraction and support activities represented 15% of all full-time employees in Aberdeen City and 7% in the surrounding area of Aberdeenshire. Other mining & quarrying was much less concentrated with a maximum share in any principal local authority area of only 3% of full-time employees in High Peak and in Rutland and 2% in North West Leicestershire and in Redcar and Cleveland.

Table 8: Regional distribution of extractives employment in 2020 from Business Register and Employment Survey

The level of rounding applied varies by estimate. Please see this article for further information on how rounding is applied.

Source: ONS, Nomis (data extracted on 9 November 2021).

The underlying data presented in Table 8 above are available on request from the UK EITI Secretariat.

Almost all UK oil and gas production comes from fields located offshore. The Oil and Gas Authority (OGA) publishes maps showing the location of oil and gas fields in GB and on the UK Continental Shelf (UKCS) and on the UK Continental Shelf (UKCS) are published online by the Oil and Gas Authority (OGA). These maps also show which areas are under licence offshore and onshore in Great Britain. The Northern Ireland Department for the Economy (DfE) publishes a map showing which areas are under licence in Northern Ireland, but there is as yet no production there.

OGA also publish data on individual wells and information on the well approval process and drilling activity.

The majority of coal production comes from sites in Scotland, England and South Wales, as mapped by the Coal Authority and . The mining and quarrying of non-hydrocarbon minerals are widely distributed across the UK. There are no significant hard-rock aggregate deposits in the South and East of England, so these materials are transported for use in these regions from further afield in the Midlands and South West in particular.

Marine Scotland curates data about onshore hydrocarbon production in Scotland also has interactive maps with data taken from the Coal Authority and other sources.

 

UK fossil fuel production and UK energy demand

UK production of fossil fuels has been, and continues to be, significant in terms of meeting UK energy demand. This is particularly true of oil and gas but, nowadays, much less so for coal.

While fossil fuels’ share of total demand has been declining, they still account for around four fifths of total primary energy demand and, based on current policies, latest BEIS projections suggest they will still account for some 70% of total primary energy demand even in 2035.

Figures 2 and 3 show the evolution of UK energy demand and production since 2000. The recent decline in coal use and growth in renewables are shown clearly as is the impact of the COVID-19 pandemic on oil demand in 2020.

Figure 2. UK Energy Demand

 

Sources: UK Energy in Brief 2021 dataset (BEIS, September 2021), Aggregated Energy Balances showing proportion of Renewables (BEIS, September 2021) and DUKES 2021 (BEIS, July 2021)

The underlying data presented in Figure 2 above are available on request from the UK EITI Secretariat.

Figure 3. UK Energy Production

 

Sources: As Figure 2.

The underlying data presented in Figure 3 above are available on request from the UK EITI Secretariat.

Notes and References
  1. GVA is a measure of economic output – capturing the value of goods and services produced by a sector – and is often used to indicate a sector’s contribution to the economy. It is gross because it makes no allowance for depreciation of capital. It is approximately equal to gross operating surplus plus compensation for employees.
  2. Generally in this page, unlike in the ONS table and some other official sources, a terminological distinction is made between “oil and gas” and “[other] mining and quarrying”, the latter comprising the extraction of coal and of all non-hydrocarbon minerals. We have included mining support service activities in the total for the sector when calculating its contribution to GDP. 
Glossary of Abbreviations
AbbreviationExplanation
BEISDepartment for Business, Energy & Industrial Strategy
billionone thousand million or 109
DfE  Department for the Economy
DUKESDigest of United Kingdom Energy Statistics 
EITI  Extractive Industries Transparency Initiative
GBGreat Britain
GDP  Gross Domestic Product
GVA  Gross Value Added
MSG  Multi-Stakeholder Group
OBROffice for Budget
OGA Oil and Gas Authority
ONSOffice for National Statistics
SICStandard Industrial Classification
UKUnited Kingdom
UKCSUK Continental Shelf
  1. GVA is a measure of economic output – capturing the value of goods and services produced by a sector – and is often used to indicate a sector’s contribution to the economy. It should be noted that the sectoral GVA data published here are very different from (and often much lower than) those previously published by the ONS. The revised estimates of GVA reflect methodological changes introduced for Blue Book 2019 (October 2019). Read more
  2. Generally in this page, unlike in the ONS table and some other official sources, a terminological distinction is made between “oil and gas” and “[other] mining and quarrying”, the latter comprising the extraction of coal and of all non-hydrocarbon minerals. We have included mining support service activities in the total for the sector when calculating its contribution to GDP. Read more