Oil & Gas UK confirmed that it will be attending a meeting of PILOT, the Government-industry forum which aims to secure the long-term future of the oil and gas sector in the UK, tomorrow (31 March 2011) to discuss last week’s Budget announcement of the unexpected increase in tax to a top rate of 81 per cent on production from mature fields.
 
Malcolm Webb, Oil & Gas UK’s chief executive, said: “The UK oil and gas industry believes that the tax change announced in last week’s Budget is ill-informed and was constructed hurriedly and without proper thought  of the potential impacts on investment, production and hence energy supply and employment. As a result of this new and totally unexpected tax rise, and as we forecast, we have already seen some significant developments being halted.

“This further example of extreme fiscal instability for major energy projects in the UK has severely damaged investor confidence. The industry stands ready to discuss with the Government ways to materially reduce the immediate negative impact of this tax change and avoid shocks of this nature to long-term, capital intensive projects which are vital to the energy security of this country.”

Ends

For more information, please contact Sally Fraser on 020 7802 2404.

Notes to Editors

1. Oil & Gas UK is the leading representative organisation for the UK offshore oil and gas industry. Its members, who number over 110, are companies licensed by the Government to explore for and produce oil and gas in UK waters and those who form any part of the industry’s supply chain.
2. PILOT is a joint programme involving the Government and the UK oil and gas industry - operators, contractors, suppliers, trade unions and SMEs, aiming to secure the long-term future of the industry in the UK. PILOT is chaired by the Secretary of State for Energy and Climate Change, Chris Huhne MP.
3. A list of PILOT members can be found at http://www.pilottaskforce.co.uk/data/pmembership.cfm

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