Gas-curb costs mount up

The Government’s proposals to curb the building of gas-fired power stations will delay offshore projects worth nearly £2bn and cost 1,300 jobs, North Sea oil companies claimed last week. The UK Offshore Operators’ Association based its warning on a study it commissioned from analyst Arthur D Little, which looked at the effect restricting gas-fired plants […]

The Government’s proposals to curb the building of gas-fired power stations will delay offshore projects worth nearly £2bn and cost 1,300 jobs, North Sea oil companies claimed last week.

The UK Offshore Operators’ Association based its warning on a study it commissioned from analyst Arthur D Little, which looked at the effect restricting gas-fired plants would have on demand for the fuel over the next five years.

The consultant calculated that the proposal would defer development of nearly £2bn worth of gas projects and lead to cuts in exploration and operating expenditure totalling £1.2bn.

Arthur D Little said there would be a resultant £1.8bn loss of tax revenues.

A survey commissioned by the Offshore Contractors’ Association indicated that more than 40% of offshore supply companies would cut jobs if sales fell by 20%.