Latest news with #EnergyPriceLevy
The National
10-07-2025
- Business
- The National
North Sea oil firms warned of fines over well decommissioning delays
The North Sea Transition Authority (NSTA), the industry regulator, said firms are "running out of time" to address a backlog of more than 500 wells needing to be plugged. The estimated cost of decommissioning these wells is £41 billion, which is shared between the private sector and the taxpayer according to BBC reports. READ MORE: 'No way' convicted felon Donald Trump should be welcomed in Scotland, Greens say Further delays could add £4 billion to the total cost, the NSTA warned. When an oil well reaches the end of its productive life, the operator is responsible for permanently decommissioning it. NSTA launched an investigation after identifying hundreds of wells that had missed their plugging deadlines. The regulator said the delays risk rig operators and supply chain companies relocating their equipment and personnel to other regions. If that happens, the regulator believes future decommissioning work in the North Sea would become more expensive. Currently, there are not enough rigs in UK waters to carry out all the forecasted decommissioning work. If the backlog continues, NSTA warned that more than 1000 additional wells could require decommissioning by the end of the decade. Pauline Innes, NSTA's director of supply chain and decommissioning, called on companies to act without delay. She said: "The stark reality is that operators are running out of time to get to grips with the backlog as more contractors consider taking their rigs abroad, which damages the supply chain's ability to meet demand and remain cost competitive." She added that while NSTA is willing to support firms, it will "get tough" on persistent delays. READ MORE: Lesley Riddoch: The SNP must take up zonal pricing fight – why aren't they? In 2024, only 103 wells were decommissioned to the final abandonment stage, with some form of work completed on 223 wells. However, 300 wells per year need to be fully decommissioned to clear the backlog. Industry body Offshore Energies UK (OEUK) said businesses are working to meet their obligations, but challenges remain. Decommissioning manager Ricky Thomson said: "Policy instability, including the Energy Price Levy and pauses in the Environmental Assessment process, has introduced significant uncertainty for the sector resulting in project delays and cost increases." He said the sector is working with the Government to ensure stable regulatory and fiscal conditions for safe, efficient decommissioning.
The National
21-05-2025
- Business
- The National
SNP MPs team up with Tories in protest over oil and gas windfall tax
SNP Westminster leader Stephen Flynn posed for a photo outside Parliament on Wednesday alongside Tory MP Harriet Cross, SNP MPs Kirsty Blackman and Seamus Logan, and Russell Borthwick, head of the Aberdeen and Grampian Chamber of Commerce (AGCC). They have given their backing to an open letter organised by the AGCC, signed by more than 2500 energy industry workers and bosses as well as people whose jobs and businesses depend on the sector, demanding the Government drop its Energy Price Levy. READ MORE: Scottish travel firm closes 'out of the blue' after 20 years with all jobs lost The levy, due to end in 2030, means the effective rate of tax on oil and gas companies is 78%, according to the AGCC. This has already cost 10,000 jobs in the sector since the tax was introduced and its continuation will result in 'deindustrialisation and mass unemployment', signatories claimed. They highlighted the recent example of Aberdeen's Harbour Energy, which announced it would cut its workforce by 25%, some 250 jobs, because of tax pressures. The letter said: 'Regrettably, we find ourselves in the economically and environmentally incoherent position whereby government policy is bringing a premature end to the oil and gas sector whilst the UK simultaneously relies on increasing amounts of carbon heavy and costly imports from overseas to meet its energy needs. 'The situation is absurd, and we urge you to act now before it's too late. The Climate Change Committee highlights the UK needs up to 15 billion barrels of oil and gas up until 2050 and our world-class oil and gas sector can meet almost half of this, unlocking £150bn to the UK economy.' READ MORE: Co-op board votes to remove all Israeli products from shelves The letter demanded an 'immediate end' to the windfall tax, first brought in by the Tories, to 'protect jobs, generate economic growth and greater energy and national security for the UK'. It added: 'The alternative, added to by the regrettable demise of Grangemouth Refinery, is deindustrialisation and mass unemployment, something any responsible government must avoid at all costs.' Flynn said: "The Labour Government's fiscal regime puts energy security in jeopardy, it causes mass redundancies and importantly it runs the real risk of ending net-zero ambitions because if you don't retain the vast skills we have in our energy sector today, you lose the people who will deliver the green energy of tomorrow. 'We were promised that Westminster's tax policy would lower bills and see investment in net-zero, but that's clearly not been the case with bills soaring and key projects like Acorn are starved of investment in favour of English sites. The UK Government was approached for comment.
