North Sea Companies Call For Stable Fiscal Regime
Senior representatives of the North Sea oil and gas industry have asked the Treasury to maintain a stable fiscal environment. The North Sea industry wants to work with the Government to ensure that the UK retains a world-competitive oil and gas industry.
The industrys key points are:
* the UK oil and gas industry is one of the most successful post-war enterprises
* the technology and skills base in the UK now rivals the US. The UK is an acknowledged world leader in skills, project management, ground breaking technology and constant innovation
* fiscal stability is an important factor in maintaining and growing the number of jobs in the sector
* a stable fiscal regime is the only environment under which UK-based companies will feel confident to invest in high risk, large-scale, capital intensive projects
* the challenges of the Atlantic frontier have generated significant technological innovations, such as breakthrough deep-water development – this technology can be applied to other areas of the world, and generates the base for a successful UK-based supplies industry
* as the North Sea province matures, the industry has
invested in new technologies to extract the maximum reserves from maturing fields
Heinz Rothermund, President of the UK Offshore Operators Association (UKOOA) said: We need the Government to continue to encourage investment in UK waters. Unlike many emerging oil and gas provinces elsewhere in the world, the seas around Britain are high-cost and extremely technically challenging.
Only from a secure home market can the UKs innovative supplier and contracting industry work to win business in the huge worldwide oil and gas market. A stable and appropriate fiscal regime is crucial to maintaining and growing international investment, innovative world class exporting companies, and jobs in the UK.
Syd Fudge, Chairman of the Offshore Contractors Association said: This industry is vital to the UK economy. It employs over 300,000 people. The UK today is an enviable base of technological innovation particularly for deep-water development that is in demand the world over. These are attributes it took a generation to grow and we cannot take for granted. The challenge for the Government is to come on our side and help us reach our export targets.
In the competition for worldwide markets, the service, supply and contracting industry is growing. UK companies have set a target for exports at £3.5 billion or five per cent of the world market. The challenge to Government is to offer stability and support, to build the industry, the skills, opportunities and wealth it offers the UK.
Mark Hope, Vice Chairman of Brindex said: Our message is simple. With the present tax regime, the industry can deliver sustainable growth in quality jobs, exports and its contribution to the economy of the UK. The Government will benefit from this through increased revenues from a growing sector. Raising the tax burden under current conditions will reduce Britains share of worldwide oil and gas investment and undermine the great successes achieved within the services and suppliers sector of the North Sea.
UKOOA represents 34 operating companies licensed by HM Government to explore for and produce oil and gas in UK waters.
Offshore Contractors Association looks after the interests of 48 member companies involved in fabrication, hook-up, modifications and maintenance, operations and decommissioning work.
BRINDEX is the Association of British Independent Oil Exploration Companies
For more information, please call 020 7802 2400.