Chancellor George Osborne is poised to deliver a fresh boost to the North Sea oil and gas industry in his Autumn Statement today.
The Press and Journal has learned that the key speech on the UK economy will include further details on plans to unlock billions of pounds in new offshore investment.
Mr Osborne is expected to rubber-stamp vital proposals to offer firms legally-guaranteed assurances over the future rate of tax relief they will get for decommissioning fields and assets.
Britain is facing a bill of more than £35billion to wind up North Sea platforms over coming years, and uncertainty over the liabilities was previously blamed for stifling investment. In March, Mr Osborne’s Budget included an announcement that the UK Government would act to give companies that certainty.
The move, one year after he plunged the sector into chaos with a surprise £10billion raid on producers, has contributed to a wave of new investment in the North Sea in the last few weeks.
UK Government sources indicated to the Press and Journal last night that further details would be announced today, but would not be drawn on specifics.
It is understood that the chancellor is likely to discuss the mechanism for the agreeing of contracts, ahead of draft legislation being published next week, as part of the 2013 Finance Bill.
Last week, after Taqa Bratani bought North Sea fields from BP for up to £818million, industry body Oil and Gas UK suggested that an announcement was imminent.
Mike Tholen, the body’s economics and commercial director, said last Thursday: “While new tax allowances have made investment in a range of challenging fields more attractive to investors, the current wave of activity comes with the expectation that the government will deliver certainty on tax relief on decommissioning and we look forward to hearing more on that front in the Autumn Statement and Budget 2013.”
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