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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 a total of £18 billion Gross Value Added and employing 60,000 people directly, with many more supported in the industries’ 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 2018, total UK extractive industry gross value added (GVA) is now estimated to have been £18 billion, with oil and gas production and associated support service activities accounting for 90% of the sector’s GVA [1]. The oil and gas industry was directly responsible for 40,000 jobs in 2018, with many more supported in the industry’s wider supply chain. It is estimated that in total 260,000 jobs across the UK were supported by the offshore oil and gas industry in 2018.

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.

Ahead of collection and publication of information on extractive-related payments to the UK government in 2018, the UK EITI Multi-Stakeholder Group (MSG) decided to exclude payments made by coal mining companies to the Coal Authority from this year’s reconciliation. These payments are no longer material relative to overall government revenues and the MSG believes that their exclusion will not affect the comprehensiveness of UK EITI reporting. The continuing economic contribution of the coal sector is, though, 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 (GVA)

 

Source: ONS, UK GDP(O) low level aggregates, 12 August 2020

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)

 Extraction 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)
20159,3391671,6792,22713,4121,709,3251,916,8960.70%
20168,4031381,6801,28911,5101,778,1341,995,4780.58%
20178,8091761,5721,47012,0271,846,6942,071,6670.58%
201814,6071611,5361,59917,9031,922,0232,144,3040.83%
201914,4981441,5201,69717,8591,984,7892,216,4520.81%
%*0.73%0.01%0.08%0.09%0.90%100%  

* The percentages in this row are shares of total UK GVA for all industries in 2019.
Source: ONS, UK GDP(O) low level aggregates, published 12 August 2020, ONS, GDP at current prices – real-time database (YBHA), published 12 August 2020
 

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 2018

SIC 07 CodeDescriptionNumber of enterprisesApproximate gross value added at basic prices (aGVA)Total employment costsTotal net capital expenditureYear
  Number£ million£ million£ million 
06Extraction of crude petroleum and natural gas16016,1042,0684,3882018
09.1Support activities for petroleum and natural gas extraction2152,2261,6161362018
08.11Quarrying of ornamental and building stone, limestone, gypsum, chalk and slate2229734212042018
08.12Operation of gravel and sand pits; mining of clays and kaolin1618723721482018
08.92Extraction of peat16451832018
08.93Extraction of salt810627262018
09.9Support activities for other mining and quarrying169-730652018
BMining and quarrying1,26220,4654,6935,1792018

Source: Annual Business Survey, 15 May 2020

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.                                                        
                            

Table 3. Number of businesses in the private sector and their associated employment and turnover, by number of employees and industry division, UK, start 2019

 Businesses numberEmployment thousandsTurnover
£ million
All businesses   
05 Mining of coal and lignite15**
06 Extraction of crude petroleum and natural gas7851320,868
07 Mining of metal ores5**
08 Other mining and quarrying1,950226,106
09 Mining support service activities5,775266,435
B Mining and Quarrying including Oil and Gas8,5306133,409
All Industries5,667,51027,0273,861,613
All employers   
05 Mining of coal and lignite15**
06 Extraction of crude petroleum and natural gas901220,835
07 Mining of metal ores0**
081 Quarrying of stone, sand and clay315185,598
089 Mining and quarrying n.e.c.1802421
08 Other mining and quarrying500206,019
091 Support activities for petroleum and natural gas extraction155195,834
099 Support activities for other mining and quarrying701102
09 Mining support service activities225205,936
B Mining and Quarrying including Oil and Gas8305232,790

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 2019, BEIS, 10 October 2019, Tables 6 & 7

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

£ million2013201420152016201720182019
Government revenue from energy taxes (incl. EU ETS)251243227178242nyanya
Government revenue from transport taxes6549565152nyanya
Government revenue from pollution and resource taxes286345357408389nyanya
of which Aggregates Levy282342354405375366390
Total Government revenue from environmental taxes603637641637684nyanya

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; see also.

nya = not yet available
Source: Environmental taxes in the United Kingdom (ONS, 3 June 2020)

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 2019 as reported by ONS amounted to 3.5% 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)

 Production of oil and gasMining of coalMining of metal ores and other mining and quarryingMining support service activities*Total extractive industriesAll UK Industries
201518221307133,764
201617121246234,336
201714119245834,685
201814121276234,916
201914120255935,518
20190.04%0.00%0.05%0.07%0.17%100%

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

Source: ONS, BEIS

 

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 Great Britain and United Kingdom (in thousands)

 SIC 2007 20142015201620172018
GB05101Deep coal mines1.60.9*-0.1
GB05102Open cast coal working1.31.1*1.21.2
GB05Mining of coal (1)2.92.01.11.31.3
GB06Extraction of crude petroleum and natural gas (2)16.615.715.212.212.8
GB07Mining of metal ores-----
GB08110Quarrying of ornamental and building stone; limestone; gypsum; chalk and slate6.77.48.67.78.2
GB08120Operation of gravel and sand pits; mining of clays and kaolin7.17.76.97.07.3
GB081Quarrying of stone; sand and clay13.815.115.514.715.6
GB08910Mining of chemical and fertilizer minerals*1.3***
GB08920Extraction and agglomeration of peat*0.2***
GB08930Extraction of salt0.40.40.30.3*
GB08990Other mining and quarrying n.e.c.1.11.31.20.91.0
GB089Mining and quarrying n.e.c.2.73.22.42.01.9
GB08Other mining and quarrying (other than mining of metal ores)16.418.317.916.717.5
GB091Support activities for petroleum and natural gas extraction (3)25.122.418.818.418.1
GB099Support activities for other mining and quarrying0.30.40.40.30.5
GB09Mining support service activities25.422.919.218.718.6
GB∑05–09Total Extractive Industries61.358.953.448.950.2
GB(1) + (2)Fossil Fuel Extraction19.517.716.313.514.1
GB(2) + (3)Oil and Gas Extraction and Support Services41.738.134.030.630.9
UK05 & 06Mining of coal and lignite; Extraction of crude petrol/gas2120181513
UK07 & 08Mining of metal ores; Other mining and quarrying1721211919
UK09Mining support service activities2930242528
UK∑05–09Total Extractive Industries6871635960

Notes: (1) Data for 2014 and 2015 come from the provisional rather than revised results. (2) n.e.c. = not elsewhere classified

  1. Employment is defined as employees plus working proprietors.
  2. Figures are rounded to the nearest thousand and to one decimal place. For example, 2.4 is equal to 2,400 and represents a figures in the range 2,350-2,449. Figures may not add up due to rounding.
  3. Cells containing an asterisk (*) represent disclosive data that cannot be published.
  4. Cells containing a hyphen (-) represent a zero or less than 50.

Source: ONS, Business Register and Employment Survey (Table 2a)

 

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%
201520%16%15%17%47%
201618%17%13%16%48%
201724%16%12%16%48%
201824%16%14%17%48%
201920%21%13%17%48%

Source: ONS (March 2020)

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) 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 share of activity in the East Midlands is also noteworthy.

Almost all extractives employment is full-time. In 2018, full-time employees engaged in oil & gas extraction and support activities represented 16% of all full-time employees in Aberdeen City and 8% 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 Rutland and 2% in Redcar and Cleveland.

Table 8: Regional distribution of number of employees in 2018

 Extraction of crude petroleum and natural gasSupport activities for petroleum and natural gas extractionExtraction of petroleum and natural gasMining of hard coal from deep coal mines (underground mining)Mining of hard coal from open cast coal working (surface mining)Mining of hard coalQuarrying of ornamental and building stone, limestone, gypsum, chalk and slateOperation of gravel and sand pits; mining of clays and kaolinMining of chemical and fertiliser minerals
London1,8254002,225000201750
South East1751002750001751,0000
East7101758850003006000
South West1501002500001,2501,5000
East Midlands1001502500003,00060020
West Midlands05500017550010
Yorkshire and The Humber2102504600006007000
North East315503650300300125175500
North West15030045010203060060010
England3,4001,5004,900103503606,0006,000600
Wales50100150506006505005000
Scotland9,05016,00025,05003003001,2501,0000
Great Britain (GB)12,50018,00030,500751,2501,3258,0007,000600
Sector share of GB Total0.04%0.06%0.10%0.00%0.00%0.00%0.03%0.02%0.00%

.

 Extraction of peatExtraction of saltOther mining and quarrying n.e.c.Support activities for other mining and quarryingOther mining and quarryingMining and quarrying including oil and gasRegion total all industriesSector share of region total
London002001255202,7455,160,2500.05%
South East001551,1951,4704,151,0000.04%
East0103559501,8352,779,0000.07%
South West150125752,9653,2152,468,0000.13%
East Midlands30075253,7504,0002,070,0000.19%
West Midlands0040107357402,561,0000.03%
Yorkshire and The Humber00150351,4851,9452,398,0000.08%
North East00501001,2501,6151,053,5000.15%
North West0350100751,7652,2153,328,0000.07%
England4040080045014,65019,55025,976,0000.08%
Wales0025101,6851,8351,272,0000.14%
Scotland2010125452,75027,8002,509,0001.11%
Great Britain (GB)5040090050018,77549,27529,758,0000.17%
Sector share of GB Total0.00%0.00%0.00%0.00%0.06%0.17%100.00% 

 

ONS Crown Copyright Reserved (from Nomis on 16 October 2019). The level of rounding applied varies by estimate. Please see this article for further information on how rounding of Business Register and Employment Survey estimates is applied.

 

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 the share of total demand represented by fossil fuels has been declining, they still account for around 4 fifths of total primary energy demand and are currently forecast by BEIS to account for nearly 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.

Figure 2. UK Energy Demand

Sources: UK Energy in Brief 2019 dataset (BEIS, August 2019), Aggregated Energy Balances showing proportion of Renewables (BEIS, September 2019) and DUKES 2019 (BEIS, July 2019)

 

Figure 3. UK Energy Production

Sources: UK Energy in Brief 2019 dataset (BEIS, August 2019), Aggregated Energy Balances showing proportion of Renewables (BEIS, September 2019) and DUKES 2019 (BEIS, July 2019)

Notes and References

Notes and References Toggle accordion

  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 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 and are also much lower than implied by ONS and OGA estimates of gross operating surplus for the oil and gas sector. The revised estimates of GVA reflect methodological changes introduced for Blue Book 2019 (October 2019). In addition, ONS estimates of GVA for 2018 and 2019 are based on movements in production and oil prices so fail to show the significant fall in oil and gas GVA in 2019 which was driven by lower gas prices. 
  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

Glossary of Abbreviations Toggle accordion

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

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