Investors Welcome North Sea Oil Tax Breaks

BUDGET 2015: George Osborne has reversed oil sector tax hikes put in place at the 2011 Budget, in an attempt to stall revenue damage caused by the oil price slump

Holly Cook 19 March, 2015 | 1:06PM
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The oil & gas sector continued to shrug off the most recent oil price decline on Thursday, as UK operators celebrated the favourable tax changes announced by the Chancellor of the Exchequer in Wednesday’s 2015 Budget statement.

In his Budget statement, George Osborne said Petroleum Revenue Tax (PRT) would be cut to 35% from 50% to support continued production in older oil fields. Meanwhile, the supplementary charge placed on oil producers will also be cut to 20% from 30% and backdated to January, in a move that has widely been seen as a reversal of the tax hikes unveiled in the 2011 Budget.

Osborne said the changes announced this week should boost North Sea oil production by 15% by the end of the decade.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
BP PLC313.65 GBX1.70Rating
Pharos Energy PLC26.20 GBX3.56
Premier Oil PLC  
Royal Dutch Shell PLC B1,362.80 GBX2.84Rating
Tullow Oil PLC54.02 GBX2.08

About Author

Holly Cook

Holly Cook  is Manager, Morningstar EMEA Websites

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