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Oil Industry Meets Government To Reconsider Windfall Tax


North Sea producers will meet UK ministers on Friday in Edinburgh to urge the scrapping of the government's windfall tax on oil and gas profits if prices decline.

  • The increase in the energy windfall tax risks causing a rapid reduction in investment and jobs, industry lobby group Offshore Energy UK (OEUK) said.
  • Several oil and gas companies with sizeable UK production have told Argus that they want to see a price floor mechanism added to the windfall tax.
  • OEUK intends to argue that additional taxes should only apply to windfall profits — so that if prices and profits fall back to "normal levels", the tax should be scrapped. OEUK chief executive Deirdre Michie will also ask for "a lasting, predictable tax regime that supports consumers and industry" and for the government to engage with the industry in the long term, "including building a lasting consensus with other political parties and stakeholders".
  • "Our message to UK finance minister Jeremy Hunt is that the windfall tax has made it far riskier — to the point where energy companies are deciding to invest overseas rather than here”, Michie said.

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