Chancellor George Osborne has hinted that further tax breaks will be introduced to help the UK offshore industry amid growing pressure for urgent action to address tumbling oil prices. Mr Osborne will use his March Budget to unveil a tax “bailout”, it was reported yesterday.sun He is working on emergency measures to reverse a worrying decline in investment which threatens the future of the UK oil and gas sector, the report said.
Centrica is celebrating a ground-breaking date in the history of UK gas exploration and production today. Gas from the Irish Sea was extracted, processed and piped into the National Grid for the first time on January 9th 1985, marking 30 years of production from Morecambe Bay, one of the country’s biggest gas reservoirs. At peak, the region produced enough gas to meet 20% of the UK’s domestic demand.
The Scottish Government has demanded urgent reform of the tax regime for the North Sea oil sector, claiming such changes could support tens of thousands of jobs and boost investment by more than £40 billion. Energy Minister Fergus Ewing said it is “vital” that the UK Government makes the changes in the Budget in March. He insisted it is “crystal clear that it is the fiscal regime that needs to change”, as he called for action from Westminster.
Low oil prices could have a direct impact on the Scottish public purse when income tax is devolved, a think-tank has warned. Oil revenues remained reserved to Westminster in both the Scotland Act 2012 and the Smith Commission, but Scotland will receive 10p in the pound from next year with full income tax receipts promised in the next round of devolution. Fiscal Affairs Scotland said it is unclear whether oil prices will return to the average £70 a barrel seen in the last three years.
A North Sea oil summit called by Aberdeen City Council will be held within the "next few weeks". Council leader Jenny Laing, who announced the move in December last year, said politicians would meet with representatives from the industry to discuss North Sea investment.
Companies which own petrol stations should be hit with a windfall tax unless they pass on deep drops in oil prices to British drivers through cheaper fuel, a Tory MP has said. Nigel Evans said fuel industry firms not lowering their prices to £1 a litre should be shamed by MPs and then hit with a tax on their profits as the cost of crude oil tumbles. Mr Evans’ call comes after Sainsbury’s boss Mike Coupe predicted fuel prices would fall below £1 a litre as Brent crude was being traded at below 50 US dollars a barrel for the first time since 2009.
Industry group Step Change in Safety has revealed its measurement strategy for helicopter passengers travelling to and from offshore installations. The move comes after Step Change announced last year that passengers will be measured by the width of their shoulders for flights. Those whose shoulders measure greater than 22inches (55.9cm) will be classified as extra broad.
The Secretary of State for Scotland will discuss the impact of falling oil prices on a visit to Aberdeen to meet staff from Norwegian oil company Statoil. Alistair Carmichael said visiting the North East was a “high priority” during what he described as a “challenging time” for the sector. His visit comes after Prime Minister David Cameron pledged to support the North Sea oil and gas industry.
Prime Minister David Cameron has pledged that the UK Government will do "everything we can" to help the North Sea oil and gas industry as prices continued to fall. The Conservative leader offered his support to the sector on the day prices dropped below $50 a barrel for the first time this decade. He also claimed that the industry’s troubles underlined the "utterly misguided" nature of the SNP’s independence plan.
North Sea oil is better off with the “broad shoulders” of the UK being able to stand behind it, the Prime Minister has said amid news of further falls in the cost of crude oil. David Cameron told MPs during Prime Minister’s Questions in the Commons that North Sea oil was a “vital” industry for the UK, adding “we should do everything we can to help it”.
The search has begun for the men, women and companies doing their utmost to ensure the activities of Britain’s offshore oil and gas industry are as safe as possible. Nominations have now opened for the fifth UK Oil and Gas Industry Safety Awards jointly organised by Oil & Gas UK and Step Change in Safety. This year’s event will take place on April 29 at the AECC (Aberdeen Exhibition and Conference Centre) with six categories including Safety Leadership and Workforce Engagement.
Scottish Labour leader Jim Murphy today called on the SNP government to establish a "resilience fund" to support crucial industries in times of crisis. Mr Murphy was speaking during a visit to Aberdeen to meet North Sea industry leaders, offshore trade unions and city councillors amid a continued fall in the global price of oil. The Labour MP expressed concern about the "human impact" of redundancies in the energy sector and the wider impact of a downturn on the local economy.
At the outset, let me make the following clear: First, the UK offshore oil and gas industry faces some very serious challenges but it is NOT in danger of being wiped out. While the industry is certainly not enjoying the best of health right now, it can and will recover. Second, the troubles we face are not all down to the recent fall in the price of oil, that is a serious complication but it is not the root cause. Third, while I am certain that these problems can and will be overcome, the cure, if it is to be effective and lasting, requires urgent, positive and collaborative action by all stakeholders across Industry and Government over the coming weeks, months and years.
The Press and Journal’s Jeremy Cresswell gives a sneak peek of what to expect in January’s edition of Energy. Some of the highlights include an interview with Oil and Gas UK’s Malcolm Webb and Opito’s group chief executive, David Doig. Watch the short clip of what to expect below.
The slump in the price of North Sea oil is no excuse for oil companies to cut back on spending on offshore safety measures, north-east MSP Lewis Macdonald said last night. Mr Macdonald, Scottish Labour’s energy spokesman, added: “The falling oil price is putting severe pressure on oil companies. “We’ve already heard about proposed job cuts among sub-contractors and of plans to cut wages but there can be no compromise on safety
Coal will remain an important contributor to the UK's energy mix into the mid-2020s at least, a Scottish supplier says. Fergusson Group's forecast came as it reported increased sales in its most recent financial year in the face of "challenging market conditions across the energy sector".
The UK Government abandoned plans to invest extra cash in North Sea safety two years before the Piper Alpha disaster – because it was not deemed a priority. Newly-released files show that Margaret Thatcher’s energy secretary highlighted the need to spend more on the sector in 1986. But Peter Walker, the minister at the time, said he had decided against asking the Treasury for any additional money after having “carefully reviewed my priorities”.
In the second part of our gallery series, we take a look at some of the defining moments in the months leading up to the Scottish independence referendum. In May WGPSN said it would be cutting contractor rates by 10%.
UK oil and gas companies are gearing up for a new era of transparency which will shed light on links between operators and governments around the world, law firm Pinsent Masons says. An overhaul of financial reporting driven by a new European Union directive is due to come into force on New Year’s Day, months ahead of other EU member states. Directors face criminal convictions and unlimited fines if details of any payments made to governments are not disclosed to Companies House. An overhaul of financial reporting driven by a new European Union directive is due to come into force on New Year’s Day, months ahead of other EU member states. Directors face criminal convictions and unlimited fines if details of any payments made to governments are not disclosed to Companies House.
The Scottish Government’s oil revenue forecast for the first three years of independence is now out by £15.5 billion, according to the Scottish Secretary. Alistair Carmichael said the latest UK Government analysis showed that 100 days after the referendum, an independent Scotland would have been facing the shortfall following a drop in oil prices. He said “serious questions” now needed to be asked about how the SNP administration “got this so badly wrong”.
Cape has been awarded a five year contract extension by EDF Energy for the supply of access, insulation and associated service in support of its eight nuclear power stations in the UK. The contract will see the company provide its services until 2021 in support of the energy suppliers. Around one fifth of the UK’s energy supply comes from EDF’s nuclear power stations, two coal fired power stations, combine gas cycle turbine power station and wind farms.
The former head of BP’s Aberdeen-based North Sea operation warned yesterday the UK oil and gas industry is facing an early death unless there is swift political action to prevent it. Dave Blackwood, who retired from BP in 2009 and is currently a non-executive director with Granite-based energy service firm Expro Group, was speaking as reports in Saudi Arabia said the kingdom was prepared to increase its oil output and claim a bigger global market share, potentially putting further pressure on the UK industry after the oil price slump of recent months. Adding his voice to widespread calls for swift tax cuts for North Sea operators, Mr Blackwood said: “Nothing less than radical change will prevent the premature demise of the basin, let alone maximise economic recovery.”
Aberdeen firm Craig Group said ongoing investment in tonnage and new international bases helped drive a big jump in both profits and turnover during the year to April 30. The privately owned, family-run shipping and energy service company has just filed accounts showing pre-tax profits increased to £20.5million, from £17.3million, while turnover grew by more than £30million to £177.7million. They also highlight almost £30million of capital expenditure during the year, of which £23.3million was spent on the continued modernisation of the group’s growing fleet of emergency response and rescue vessels.
At a difficult time for the oil and gas industry when we are addressing a range of challenges including the rapid, steep drop in oil price, we can fully appreciate why Aberdeen City Council has called for an oil and gas summit. We are well aware of the concerns across the region regarding jobs and the future for businesses in the area and recognise that a summit, which involves the participation of such a wide cross-section of politicians, industry representatives, and trade unions, will focus minds and join effort on what needs to be done to sustain Aberdeen's position as the oil capital of Europe. We welcome this positive and collaborative approach, but it is also important to acknowledge the truly constructive work being undertaken by the industry and the Government on a number of fronts to help secure the next phase of development on the UK continental shelf (UKCS).
As we watch the oil price go down, with no indication of how low it will go or how long this trend will be sustained, it’s increasingly clear that the impact of this – alongside a double whammy of falling production levels plus cost inflation - is being keenly felt by operators across the UK Continental Shelf (UKCS). In recent weeks, we’ve seen Christmas parties cancelled, free meals curtailed and shareholder revolt on CEO pay as well as plans to cut onshore and offshore contractors pay in 2015. There is also the prospect that up to $150bn of global projects could be labelled as uneconomic next year, resulting in them being mothballed or cancelled altogether.