Britain’s National Audit Office (NAO) mentioned Friday decommissioning of the UK’s offshore oil and fuel infrastructure might price taxpayers £24 billion ($31.6 billion) or extra within the subsequent 44 years, Kallanish Energy reviews.

The estimated price is predicated on the federal government’s tax aid supplied to operators, within the interval 2018-19 to 2062-63. With at the moment 320 fastened installations within the UK, principally within the North Sea, the oil and fuel regulator estimates future decommissioning to price £45-77 billion ($59.2-101.three billion)

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Due to the maturity of the UK Continental Shelf, operators are more and more decommissioning their infrastructure, spending over £1 billion ($1.31 billion) on this yearly since 2014, the NAO mentioned. Such an quantity is, nevertheless, partially recovered by way of tax aid.

The drawback is with decrease manufacturing and decrease crude oil costs, the federal government has paid out extra to grease and fuel operators in tax aid than it acquired in income, leading to repayments of £290 million ($381.7 million), NAO argued.

“The NAO discovered that there are gaps within the authorities’s understanding of the prices and advantages of modifications to the tax regime,” it mentioned, in assertion.

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The authorities mentioned in an emailed assertion it’s working with the oil trade to attenuate decommissioning prices. “By offering tax aid on decommissioning we’re attracting continued funding into our reserves – supporting jobs, boosting the economic system and defending our power provide,” it added.

Source: www.kallanishenergy.com

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