The offshore industry is due to be hit with a £200million bill over the next two decades to help pay for Aberdeen’s new North Sea regulator.
The UK Government confirmed yesterday that it plans to give itself new powers next summer to levy oil and gas firms in order to fund the body.
Ministers also revealed that the number of officials dedicated to overseeing the North Sea sector would rise from 59 at present to about 145 as the Oil and Gas Authority gets up and running in Aberdeen. The creation of the new regulator was recommended after a major review was held into the future of the offshore industry, led by the businessman Sir Ian Wood.
The study found that three to four billion more barrels could be extracted over the next 20 years if the proposals were implemented, at a value of £200billion to the UK economy.
Energy Secretary Ed Davey told parliament yesterday that the assessment “reconfirms the importance of ensuring the Wood Review recommendations are fully implemented as quickly as possible”.
According the report, the North Sea industry will be expected to pay £202.4million over the next 22 years on staff salaries, office accommodation, IT and recruitment for the new regulator.
It means annual cost to the sector of more than £9million, on top of the £70million already paid each year in offshore permits. The estimated average salary for the new posts would be about £79,000, including pension costs. The UK Government will pay £3million in each of the first five years.
Malcolm Webb, chief executive of trade body Oil and Gas UK, said: “We believe the significant benefits which can flow from the improved strategic focus and professional delivery of a new and well-resourced regulator should produce a positive return for both industry and government.”
Labour’s shadow energy minister Tom Greatrex said: “With oil resources, by definition, declining and revenues, by record, declining, a UK-wide framework is the only thing that makes sense for Scotland.”
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