Bad Budget for UKOOA

Responding to yesterday’s Budget statement, the UK Offshore Operators Association (UKOOA) accused the Treasury of ignoring the urgent needs of the UK's offshore oil and gas industry. The UKOOA claims production is being undermined by high costs and punitive tax.

Malcolm Webb, UKOOA's chief executive, said: 'The Treasury clearly recognises that lower taxes are good for business, but unfortunately fails to apply that principle to our industry.

'UK offshore oil and gas producers have not been given any reduction in corporation tax and still continue to suffer under a punitive 50% rate for corporation tax and a total tax rate of 75% on the production from its older assets. The Chancellor was quick to raise the tax take from this industry when he saw oil and gas prices rising towards $60 dollars a barrel. But now that the price of gas (which makes up almost half of total UK production) has fallen to the equivalent of $20 per barrel, he sits on his hands.