The government will provide tax relief to new shallow-water gas fields in the country which will attract investments by about £3.5bn, create thousands of jobs, and increase the oil and gas recovery by over 200 million barrels of oil equivalent.
Oil and Gas UK chief executive Malcolm Webb said the associate is encouraged by the support announced for new shallow-water gas fields in the UK, which have particularly high capital costs and are subject to 62 per cent tax on production.
"It makes absolute economic sense to promote oil and gas production from the resources we in the UK are fortunate enough to possess; we believe that the measure should trigger the development of specific gas projects involving expenditure of £2.4 billion, the creation of 4,000 British jobs and £600 million of additional tax revenues for the public purse," Webb added.
"While we are encouraged by the Chancellor’s confirmation that the Government will continue to work with the industry on this, discussion with the Treasury has been ongoing for many months and time is now of the essence.
For some fields near the end of their planned life, an early decision on support for further investment is urgently required if the UK is to reap the full benefit in terms of jobs, tax revenues and energy security."
Oil and Gas UK is the trade association for the UK offshore oil and gas industry.
