Scottish First Minister Alex Salmond blasted back at Treasury Secretary Danny Alexander yesterday in a continuing row over the future of the North Sea oil industry.

Mr Salmond said the sector has been “neglected and undermined” by successive UK governments, after Mr Alexander accused him of making plans based on “untold oil wealth beyond anything independent forecasters consider plausible.”

Mr Salmond insisted that his projections were based on “robust” assumptions.

He said: “As Sir Donald MacKay, economic adviser to the Secretary of State for Scotland for 25 years, has concluded: ‘There is no hole in the Scottish government’s oil predictions.’

“Sir Donald has highlighted that ‘there is a mountain of black gold missing’ from your own figures.”

The First Minister then issued a fiery rebuke to the Chief Secretary.

“Given that Sir Donald quite literally wrote the book on the political economy of North Sea oil when you were but three years old, perhaps you should acknowledge his expertise and authority in such matters rather than cite the OBR’s (Office for Budget Responsibility) ability to forecast the next three decades when they have patently failed to forecast accurately the last three years.”

Mr Alexander had said on Friday that the First Minister was “promising milk and honey” rather than spelling out the “painful choices a separate Scotland would have to make.”

Last week the OBR revised down the amount of cash it expects to be raised from North Sea oil and gas revenues. The independent body is now forecasting revenues of £61.6 billion will be raised between now and 2040 — down from £82.2 billion.

But the Scottish government claims the OBR forecasts are based on a “very low estimate of future total production.”