17 Mar 2015

UK needs oil tax cuts to attract North Sea investment

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$Citizen fears about hydraulic fracturing, a drilling procedure used to pry oil and gas from rock deep underground, have made "fracking" the hottest political question in Colorado. (Ed Andrieski, AP)$

Citizen fears about hydraulic fracturing, a drilling procedure used to pry oil and gas from rock deep underground, have made "fracking" the hottest political question in Colorado. (Ed Andrieski, AP)

London - Britain's finance minister must announce bold oil tax changes in his 2015-16 budget this week to inject new life into the battered North Sea where investment in new projects has fallen and billions of dollars of assets are up for sale.

Oil and gas companies in the area are facing a perfect storm of record-high investment costs and a slump in global oil prices, which has put their balance sheets under strain.

As a result, more than $7bn of oil and gas fields are currently up for grabs in Britain's North Sea, according to data compiled by oil and gas consultancy 1Derrick - but closing deals has proved difficult due to a dearth of buyers.

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