UK seeks tax advice from oil industry on North Sea investments
LONDON (Bloomberg) -- The UK government has sought the oil industry’s suggestions on a future tax structure that will spur investments in the North Sea, where as many as 24 Bbbl of oil and gas lie untapped.
The consultation, to be held over 12 weeks, will be aimed at maximizing the value of the UK’s oil and gas resources and ensuring the nation receives a fair share of the profits, according to a statement by the Treasury department.
Exploration and production of reserves in the North Sea are becoming more difficult and expensive, and tax revenue is expected to keep declining over the long-term as fields get abandoned. A review of the industry earlier this year urged the government to set up a regulator to help raise production.
A group representing the energy industry welcomed the consultation, saying a tax review was urgently needed as investors were increasingly looking elsewhere.
“The current fiscal regime is becoming a barrier to investment both in new fields and in the many mature opportunities,” Malcolm Webb, CEO of Oil & Gas UK, an industry group, said in a statement.