Legislation is gateway to greater North Sea investment
20 March 2013
Derek Leith, head of oil and gas taxation and office managing partner at EY in Aberdeen comments on the measures introduced in today’s (Wednesday 20 March) Budget
“Today’s Budget announcement will act as a gateway to greater investment in the North Sea, creating an active market that is attractive to companies across the Oil & Gas spectrum, from super majors to niche operators.
“Cementing the promise of contracts that guarantee tax relief on costs associated with deactivating and dismantling oilfields during the lifetime of this and future parliaments removes another layer of fiscal uncertainty from the UK Continental Shelf and should facilitate the transfer of assets.
“Smaller companies that had previously been priced out of potential deals will now be in a position to maximise recovery from existing infrastructure, while larger players will be able to free up capital to fund further exploration and production.
“This is the culmination of two years of negotiations between the Oil & Gas sector and the UK Government, and emphasises the greater understanding the latter now has of the issues facing the basin and its value to the public purse through the delivery of millions of more barrels of oil equivalent."