ABERDEEN, December 04 (Sputnik), Mark Hirst – A leading British expert in oil and gas exploration has welcomed the UK Government’s stated intention to reduce its tax take from North Sea oil and gas production, but told Sputnik News the industry needs more clarity and detail about how and when that will happen.
“It doesn't seem we're going to get a huge amount of clarity in terms of actual figures so whilst it would appear that there is an intention to reduce the overall tax burden as yet we don't really know by how much,” Dick Winchester, the Managing Director of oil consultants Pipistrelle and a member of the ‘Independent Expert Commission on Oil and Gas’ told Sputnik.
On Thursday Chief Secretary to the Treasury, Danny Alexander MP, travelled to Aberdeen to set out the UK Government’s plans which, Ministers hope, will lead to a fresh wave of oil and gas exploration in the North Sea.
In his Autumn Statement Wednesday, Chancellor George Osborne pledged to reduce the supplementary charge levied by the Treasury from 32 percent to 30 percent amongst a package of other measures aimed at stimulating the industry.
But Winchester told Sputnik that a key new development was the commitment to fund new seismic surveys in currently unexplored areas of the North Sea.
“The one good thing I've heard so far is that the UK Government has decided to fund or part fund seismic survey work particularly aimed at unexplored areas. This is something we [The Independent Expert Commission] recommended in the Scottish Oil and Gas Commission report as well. Sadly, of course, the UK doesn't actually have an indigenous seismic survey company,” Winchester added.
The oil and gas expert went on to call on British Ministers to produce detailed proposals sooner rather than later.
Alexander told industry representatives in Aberdeen, “The days of the government regarding the North Sea primarily as a means of raising revenue are over. You are first and foremost a vitally important economic asset.”
“We're incentivising and working with the industry to develop new investment opportunities and support new areas of exploration. This will help ensure that the industry continues to thrive and contribute to the economy,” Alexander said in his speech.
But the environmentalist body Friends of the Earth were critical of the Government’s plans for further North Sea exploration and accused Ministers of ignoring efforts to avert “catastrophic climate change”.
“While the international community is trying to thrash out a plan in Lima to head off the threat of catastrophic climate change, the UK Government is trying to squeeze as much oil out of the North Sea as it can,” Campaign Director Craig Bennett said in a statement issued Thursday.
