Chief Secretary to the Treasury Danny Alexander said the UK Government will take the time until the Budget announcement on March 18 to get the right measures in place to support the North Sea.
His comments were made after Sir Ian Wood called for major tax cuts to help the oil and gas industry.
Mr Alexander said he had discussed the issue directly “on many occassion” and the government had already made some “significant changes”.
He said: “I think particularly the new investment allowance, which is about giving people significant tax breaks on the new investment that we want to see.
“Ed Davey announced yesterday a commission which will be led by Andy Samuel, who is leading the new Oil and Gas Authority, to look at precisely what is needed.
“I think that it is right to say, with the Budget just a few weeks away, let’s use that time to make sure we have the right, comprehensive measures to support this crucial industry.
“Sir Ian also rightly observed that when prices are this low, people are not making profit so they are not paying taxes anyway, so I think we can take that time to get things right.
“What matters is having a regime that, exactly as Sir Ian says, incentivises investment and encourages people to stay the course in the North Sea.
“Because, of course, the oil price, all the analysts suggest, will start to recover in the years to come, so we need to put ourselves in the position where the infrastructure is being maintained, where the fields are being maintained, so that we can capitalise as and when that does happen.
“There is still a huge amount of oil and gas in the North Sea, and as part of the United Kingdom we can make sure that that is stabilised when prices have recovered.”
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