East of England industry chiefs are being urged to put pressure on the Government to help sustain North Sea gas production and exploration, in a rallying call from Simon Gray, CEO of the East of England Energy Group (EEEGR).
Gray fears that without a change in the tax regime to encourage further investment, the sector could dwindle and leave gas reserves untapped when they could help fuel the UK for decades to come.
“I want to rally support for the industry by pointing out the dangers of premature decommissioning of gas fields and removing infrastructure in the Southern North Sea,” Simon Gray said.
“Instead, we need to ensure further exploration and maximise new field developments.”
Gray is urging all members of EEEGR to reinforce his message to Government.
“I am also asking the New Anglia LEP, Chambers of Commerce, economic development departments, ports, airports and all stakeholders who benefit from the offshore industry in the region to have their say. We must make sure that the voice of the East of England is heard as loud as those in Aberdeen and the North East and to ensure that Government is aware of the particular case and issues we have here in the East of England,” he added.
His call comes in response to The Treasury’s search for evidence on the future of the UK oil and gas tax regime and how it should further support the industry as well as ensuring the nation receives a fair share of the profits.
Gray said that gas had historically traded at around half the price of oil but faced similar costs and he wanted the Government to recognise that issue with a lower tax threshold for gas.
“We would also ask for further stimulation for gas exploration to ensure maximising economic recovery of gas reserves – as the Southern North Sea is a solely gas resource – while existing infrastructure and subsea resources are still in place.”
At the EEEGR2014 Conference earlier this month, Sir Ian Wood urged the Government to look at a separate and more sympathetic tax regime for gas, saying that money invested in the sector now would bring even greater returns for the Treasury long-term. Sir Ian was the author of a major review for Government into the oil and gas industry.