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Times Online: Shell chief calls for cut in tax on North Sea oil

Feb 14th, 2006
by admin.

By Times Online
Jeroen van der Veer, the chief executive of Shell, today called for cuts in corporate taxes on North Sea oil companies if the price of a barrel falls.
The UK Government said it would add a 10 percentage point tax increase on North Sea profits, in response to the bumper profits oil companies were enjoying as a result of booming oil prices.
In the past two weeks, BP, the second largest oil company in the world, has reported fourth-quarter profits up 26 per cent on 2004, as it announced annual profits of £11.04 billion, while Royal Dutch Shell reported annual profits of £12.93 billion, a record for a British-listed company.
But a slowdown in the output from the North Sea fields also saw Britain become a net importer of oil in 2005 for the first time since 1979.
Mr Van der Veer warned that rising taxes could hit investment in the declining off-shore oil field but added that a pledge to reduce taxes when prices fell would provide the kind of stability needed to guarantee investment in the Continental Shelf.
“If we see that kind of commitment, so that if oil prices fall then the tax (rise) is reversed, that would support the conditions to grow … additional investment in the North Sea,”Mr van der Veer told the International Petroleum Week conference in London.

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