Wednesday 20 March 2013

Certainty on Decommissioning Tax Relief will Boost Investment and Production, says Oil & Gas UK

Malcolm Webb, Oil & Gas UK’s chief executive, said: “Recent collaboration between Government and industry on tax allowances that promote investment in UK oil and gas is now bearing fruit. With record investment forecast this year, new jobs are being created across Britain and an upturn in production and tax revenues should follow. It is critical that we sustain this trend.

“The industry has been working closely with the Treasury since the 2011 Budget to resolve the long-standing problem of uncertainty on decommissioning tax relief. The measures announced today will for the first time ever give companies the certainty they need over the tax treatment of decommissioning. At no cost to the Government, it will speed up asset sales and free up capital for companies to use for investment, extending the productive life of the UK continental shelf.

“Following the Budget, we look forward to the continuation of this collaboration between industry and Government, against the backdrop of each of the UK and Scottish Governments’ long-term industrial strategies for this sector.   The continuing evolution of the fiscal and regulatory regime and the steps to boost the supply chain’s capacity to drive exports, create employment and foster innovation will enable Britain to make the most of its valuable national asset, the products of which are essential to our daily lives and can underpin our prosperity for many decades yet to come."

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Oil & Gas UK's latest forecasts of exploration, investment and production are available here.