Warning over North Sea tax

Caitlin Morrison
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LOW OIL prices could cost the UK economy £200bn unless changes are made to the tax regime for drilling in the North Sea.

The past week saw two of Britain’s largest oil companies, BP and BG Group, slash capital expenditure projections as they reported declining profits, with BP boss Bob Dudley predicting that the current weak pricing in the market will continue for “probably several years”.

In an interview with the Sunday Telegraph, Sir Ian Wood, founder of oil firm Wood Group, warned that six billion barrels of oil reserves, worth £200bn, may be abandoned in the region. He commented: “The key is not allowing irreversible damage, which is why I believe we have got to look at adjusting the tax regime now.”