(MENAFNEditorial)
FOR IMMEDIATE RELEASE Illinois – United States – February 122015 (PR Buzz):While the UK government is likely to implement changes to the fiscal regime governing North Sea oil that will reduce the tax burden the outlook for the country’s shale sector is less favorable to the industry.
Reportstack’s latest report "United Kingdom Upstream Fiscal and Regulatory Report" states that UK chancellor George Osborne has indicated that he will introduce new tax breaks for the oil industry in the March 2015 budget and the government may be able to legislate for such changes before the 7 May general election. In contrast the investment climate for shale gas exploration and development is worsening.
One of GlobalData’s Upstream Fiscal Analyst says that barring a significant recovery in oil prices it is also likely that the next government will move to further improve the UK fiscal regime’s attractiveness but the extent of such moves will ultimately depend on the make-up of that government.
“Any changes introduced by a Conservative government are likely to be tempered to an extent by its deficit-reduction targets and it remains to be seen whether the Labour party will propose any incentives for the industry during the election campaign.
“However with a hung parliament a strong possibility the smaller parties’ policies may prove significant. In particular the Scottish National Party (SNP) is likely to push for substantial tax cuts as well as uplift and exploration-relief incentives similar to those in Norway.”
The outlook is less promising for the shale sector despite the UK government recently introducing the onshore allowance and removing access obstacles to shale development as the result of the forthcoming general election will again have a considerable impact on future policies.
“If the next government is once more led by the Conservative party the policy stance towards shale is likely to stay broadly positive. However the Labour party is currently ahead in the polls and its policy stance generally favors tighter regulation.
“The government has already been forced to accept proposals by Labour that will ban fracking in national parks areas of outstanding natural beauty sites of special scientific interest and groundwater source protection zones.”
The analyst concludes that if the next government is a coalition smaller parties’ policies may play a key role with the SNP and Green party both known advocates of a renewed moratorium on fracking.
To access full report with TOC please visit United Kingdom Upstream Fiscal and Regulatory Report.
Contact:
Debora White
United States
Email: debora@reportstack.com
Ph: +1-888-789-6604
Reportstack
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