Energy minister Charles Hendry has said that UK energy policy is incomplete without a central role for oil and gas.
Mr Hendry said that while the UK energy market is delivering low consumer bills there was a lack of infrastructure investment for the future.
Adding that the declining reserves in the North Sea called for a news gas strategy.
“The North Sea is in decline, but the rate of decline is where there is a clear national interest.”
The government is set to launch a gas generation strategy in the autumn, which is to explain the role of gas in a changing infrastructure landscape.
Mr Hendry said there remains “immense interest” in the North Sea but that the interested companies were no longer oil majors but smaller independent exploration and production units.
The government intends to refocus the PILOT scheme, a joint program between the UK government and oil and gas players, to foster greater co-operation in the future of the North Sea.