Chancellor makes encouraging comments about west of Shetland developments
Chancellor Alistair Darling has made positive noises about helping to develop the oil and gas resources off the west of Shetland in his pre-budget report.
Among a series of proposals designed to help businesses and restore growth in the ailing UK economy, he revealed that the government was in discussions with the oil and gas industry on the economics of developing infrastructure in the deep waters and the possibility of tax breaks for exploration and development.
Mr Darling also announced changes from April next year to what is called the ultra high pressure, high temperature field allowance, which the pre-budget report says could help with the recovery of 300 million barrels of oil and gas from the North Sea, and tax reforms designed to encourage investment in the area.
Orkney and Shetland MP Alistair Carmichael welcomed the changes. “At [the] Off Shore Europe [exhibition] earlier this year this was the number one issue of concern to developers,” he said. “They all agreed that this sort of measure would be a boost to developing the industry west of Shetland. We should remember that the waters west of Shetland could contain up to 20 per cent of the UK’s remaining gas reserves. Its development will be crucial for the UK’s future energy production.
“Developing the potential west of Shetland will be good for Shetland’s local economy but is also important to the UK’s future economic strategy. The work of exploiting the potential west of Shetland is cutting edge and highly challenging work. I am pleased that the government is at last accepting this.”