UK Minister launches consultation on North Sea royalty planNews // July 19, 2002
Wilson said: "The industry has welcomed the Government's decision to abolish theRoyalty on North Sea oil and gas production as part of the package of changes announced in April by the Chancellor."
"Royalty applies only to older fields and its abolition will simplify and modernise the North Sea fiscal regime. Together with the 100 per cent first year allowance for capital expenditure, it is designed to promote long-term investment and ensure a healthy future for the UK's oil and gas industry."
"The measure would be worth around £200 million in the next year to licensees. A number of dates for abolition have already been suggested and we are studying these closely. But, for theconsultation process to be complete, all connected with the industry must have the opportunity to make formal representations with their views."
The paper being issued was produced in conjunction with HM Treasury and Inland Revenue and seeks comments from holders of petroleum production licences and others. Officials will be happy to have meetings with key interested parties during the consultation period, which closes on 4th October 2002. The date for abolition of Royalty will be announced soon afterwards.