OilVoice - Oil & Gas UK Meets Shadow Chancellor to Highlight Industry's Vital Economic Contribution

Oil & Gas UK Meets Shadow Chancellor to Highlight Industry's Vital Economic Contribution

Saturday, May 16, 2009

Oil & Gas UK, accompanied by some of its leading Aberdeen-based members met the Shadow Chancellor, George Osborne MP, on his short stop-over in Aberdeen and took the opportunity to convey the vital importance of the UK oil and gas industry to this country's economy.

Chief executive, Malcolm Webb, said: "We enjoyed the opportunity to highlight to the Shadow Chancellor the vital importance of the UK oil and gas industry, not only in ensuring our security of energy supply and maintaining tax revenues, but also in supporting employment, cutting edge research and the export of oilfield goods and services around the globe. Our industry today supports the UK balance of trade to the tune of £45 billion per year.

"However, we explained that combined with the effects of cost escalation in recent years, the collapse in oil and gas prices and the drying up of debt and equity markets was having a dramatic, dampening effect on capital and exploration spending.

"Oil & Gas UK and its members acknowledge that the industry has a responsibility to address and deal with the cost issue but the action it is taking on that front will only provide part of the solution. If the competitiveness of UK projects is to be revived in order to attract the necessary investment, our province needs a stable and predictable fiscal regime that is appropriate for this mature oil and gas province.

"We advised Mr Osborne of our general disappointment with the 2009 Budget announcement, which we view as a lost opportunity by the Government to put the industry on a better footing and stimulate investment across the province at no cost to the taxpayer. We stressed that we were certainly not looking for subsidies or bailouts and that the measures we proposed could have been implemented at no overall cost to the Exchequer. With 20,000 jobs riding on every £1 billion of capital investment, we are very concerned about the potential impact on UK employment levels in our industry, as we now fear capital investment may fall by £2 billion or more over this year and next."