Oil: Prices

HM Treasury written question – answered on 20th March 2015.

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Photo of Jim Murphy Jim Murphy Labour, East Renfrewshire

To ask Mr Chancellor of the Exchequer, when Ministers of his Department last met representatives of the oil and gas industry to discuss the fiscal implications of falling oil prices for the North Sea oil and gas industry.

Photo of Priti Patel Priti Patel The Exchequer Secretary

The government understands the challenges currently facing the UK oil and gas industry and is engaging closely with stakeholders on this.

We have been proactive in our response to the fall in oil price. Budget 2015 announced an ambitious programme of reform across the oil and gas tax regime to make sure the North Sea continues to attract investment and safeguard the future of this vital national asset. The government announced an immediate cut to the rate of the Supplementary Charge, from 30% to 20%, which is already in effect; a reduction to Petroleum Revenue Tax, from 50% to 35%, from January 2016; and the introduction of a new Investment Allowance to support investment in the UK Continental Shelf.

This package is expected to deliver over £4bn of additional investment and increase production by 15% by 2019, the equivalent of 0.1% of GDP.

Details of meetings between Treasury Ministers and external organisations are published on the Gov.UK website at the following link: https://www.gov.uk/government/collections/hmt-ministers-meetings-hospitality-gifts-and-overseas-travel.

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