North Sea oil investment at 30-year high: report

A report by an oil and gas trade body Oil and Gas UK says investment in the North Sea is the highest in 30 years and rising.

Companies looking for offshore energy invested £11.4 billion in 2012, according to Oil and Gas UK, which comprises over 320 companies active in the area, and is expected to rise to £13 billion this year, it projects.

The report credited the recent introduction of tax relief for investments in "difficult projects", as having contributed to the robust investment climate in the sector.

Malcolm Webb, Oil and Gas UK's chief executive, said, following two disappointing years brought about by tax uncertainty and consequent low investment, the UK continental shelf was now benefitting from record investment in new developments and in existing assets and infrastructure, the strongest for over three decades.

Oil and Gas UK, which represents the sector and which carried out the survey, linked the sharp drop in production over the past couple of years to tax raids by the previous Gordon Brown government in 2011

With new relief measures passed by chancellor George Osborne last year, gas fields in shallow waters would be exempt from a 32-per cent tax on the first £500 million of income. The UK government also plans to change tax rules on decommissioning.