Auto Amazon Links: No products found. Blocked by captcha.
The government is set to reveal new measures easing restrictions on oil and gas drilling in the North Sea as part of its upcoming North Sea Strategy. This strategy will be announced by Chancellor Rachel Reeves during her Budget speech, followed by a detailed document from the Department for Energy Security and Net Zero. The anticipated changes are expected to officially relax the existing moratorium on new drilling by permitting developments that are linked, or “tied back,” to existing oil and gas infrastructure.
This approach, which allows expansion into new areas by connecting to established fields, was initially introduced at the Labour conference last September. However, when the results from the broader North Sea review are published, they will not specifically address the ongoing ministerial decision regarding the Rosebank field. This controversial project, previously opposed by Ed Miliband during his time in opposition, remains subject to its own regulatory and judicial scrutiny. Nonetheless, the general loosening of regulations is widely believed to improve the prospects for Rosebank’s approval.
Historically, “tiebacks” have been employed for small, remote extensions of oil and gas fields that stretch into unlicensed seabed areas. Rosebank, in contrast, is a significantly larger development that demands its own dedicated production infrastructure, making it distinct from the typical tieback projects. Alongside these regulatory considerations, speculation has surfaced about the potential early phase-out of the current 78% windfall tax, which is scheduled to expire in 2030.
The oil and gas sector has been vocally pushing for changes to the windfall tax, also called the energy profits levy, claiming it has severely hampered industry investment. With capital expenditures at historic lows, many operators have redirected funds to countries boasting more favorable tax regimes. Research conducted by Robert Gordon University in Aberdeen highlights that around 1,000 jobs per month are being lost. Industry voices suggest that the approval of tiebacks alone would be insufficient without tax concessions, possibly through a “cap and floor” mechanism triggered by rising oil prices similar to those experienced after the Russian invasion of Ukraine. The industry contends that recent declines in crude oil prices indicate the “windfall” period has passed, and taxation should be adjusted accordingly
Read the full article from The BBC here: Read More
Auto Amazon Links: No products found. Blocked by captcha.