Oil & Gas UK challenges Chancellor to relax investment regime
7 Mar 2017
The oil and gas industry has called on government to ensure a more liberal regime for investment funding in the sector.
Speaking at the launch of Oil & Gas UK’s Business Outlook Report 2017, chief executive Deirdre Michie said urgent action was needed to ensure the progress of new projects destined for the UK Continental Shelf.
She said: “It is crucial that these projects are progressed efficiently through to development and new ones matured to avoid a potentially significant production decline after 2020 and provide much needed business opportunities for the supply chain.”
The challenges for the basin ahead, particularly for companies in the supply chain, are still considerable
Deirdre Michie, chief executive, Oil & Gas UK
Although the sector had made considerable efficiencies, and reduction in headline tax rates had helped create “one of the most competitive fiscal regimes for upstream investment”, there was now a decline in fresh capital investment said Michie, with exploration and total spend down.
This coincided with substantial growth in the number of new fields. A total of 34 have started production since 2013 and a further 13-18 are expected to begin in the next year.
Added Michie: “The challenges for the basin ahead, particularly for companies in the supply chain, are still considerable. As one means to help address this, Oil & Gas UK is asking the Treasury to extend the investment allowance to operational activities that are focused on maximising economic recovery.”
