Global Investors’ Confidence in UK Upstream Sector on the Rise
Noting the acquisition of a number of interests in UK oil and gas fields by JX Nippon Exploration and Production (U.K.) Limited (JXNEPUK), Malcolm Webb, Oil & Gas UK’s Chief Executive, made the following announcement.
“Recovering the 24 billion barrels of oil and gas that remain on the UK continental shelf (UKCS) will bring jobs and tax revenues to Britain so we welcome an active and lively market in UK assets which encourages companies to invest here.
“Engagement with the Treasury over the last 18 months has brought forward several measures designed to promote investment, such as tax allowances for new and existing projects with difficult economics and the decommissioning relief deed which aims to provide certainty on decommissioning liabilities. Today’s announcement by JX Nippon is a further reflection that together, these measures are beginning to restore confidence among global investors in our province, which is excellent news for the UK-based supply chain, our wider economy and energy security.”
David Nash, Executive Director at JXNEPUK, said: “JX Nippon’s investment aims to consolidate the UK as an important profit centre for the JX Group in the long-term. A number of previous adverse tax changes made it very challenging to justify such a major investment, but through 2012 the collaborative approach that has been developed between industry and government has begun to ameliorate the situation. The introduction of field allowances and steps being taken by the government to provide certainty on decommissioning tax relief contributed to our decision to finally proceed with this acquisition. We look forward to continuing pragmatic responses to encourage further investment in the future.”
Press Release, December 20, 2012