Oil & Gas UK: Falling oil prices call for faster reform

In light of falling oil prices, which were at a five-year low last week, Oil & Gas UK has called for the government’s reform to the oil and gas fiscal regime to be accelerated. 

To remind, George Osborne, the UK Chancellor of Exchequer, recently presented the Autumn Statement to the Parliament where he promised that the government will shortly set out major reforms to the oil and gas fiscal regime, to make sure that the UK Continental Shelf continues to attract investments.

The Chancellor’s announcement that the ‘vital’ UK offshore oil and gas industry is to see an immediate reduction of two percentage points in its tax rate, was lauded by the Oil & Gas UK as “an important first step towards improving the fiscal competitiveness of the UK North Sea.”

Oil & Gas UK’s economics and commercial director, Mike Tholen commented:

“The UK oil and gas industry is facing a serious challenge. The falling oil price is affecting activity across the UK North Sea and companies are having to take hard decisions in light of this challenging business environment.

“To sustain the economic benefits the industry has provided for many decades, Oil & Gas UK believes that urgent action is needed to deliver the programme of fiscal change by the 2015 Budget and we are committed to work closely with by HM Treasury to do so. In parallel, there needs to be swift implementation of the Wood Review recommendations whilst industry concentrates on addressing the costs and efficiency of its operations across the North Sea.” 

Offshore Energy Today Staff

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