The chief executive of Oil & Gas UK has branded the £1.3billion tax breaks for the North Sea industry previously signed off by the Treasury as “so last year”.
Deirdre Michie said the measures unveiled by George Osborne last March – which included a slashing of rates and new investment allowances – were obviously “very welcome”.
But she insisted the situation had “fundamentally changed” over the past 12 months and called on the UK Government to provide further support.
Among the measures the industry body is appealing for are steps to help unlock the late life asset market and encourage exploration.
It wants the chancellor to permanently remove the special taxes from all discoveries that are made over the next five years.
In addition, it is seeking action to strengthen and support decommissioning liability, helping new players to come in and establish the southern North Sea and wider UK as a decommissioning centre of excellence.
Pressed to say how effective further tax cuts could be in the context of the downturn, she admitted that on their own they did not constitute a “silver bullet”.
But she emphasised the need to make the North Sea a competitive and attractive place to do business moving forward.
She told Energy Voice at the Southern North Sea Conference in Norwich that the industry had been accused of “crying wolf” in the past.
She went on: “As per Aesop’s tale, the wolf did eventually turn up. If you think about this industry, it’s a long-term industry, it’s long-term investment.
“You pull a lever today, you don’t necessarily see it happen immediately so that’s why we need thoughtful intervention and removing special taxes we think is that thoughtful intervention.”
Ms Michie said both industry and regulator the Oil and Gas Authority (OGA) were playing their roles, adding: “We are saying that the other part of the jigsaw is the fiscal change that is needed to happen.
“Because it will encourage this to be a competitive and attractive basin that can compete at a global level in a way that it’s not at the moment.
“Investment levels are shrinking to an all-time low. If we don’t position ourselves at every opportunity, then we will miss a trick.
“We think it is absolutely appropriate to be spending our energies focusing on and looking for that intervention by Treasury.
“It’s how do we manage to make that intervention now so that we can do everything we can and not look back and say why didn’t we.”
Ms Michie made the comments after a round-table discussion with industry representatives at the conference, organised by the East of England Energy Group (EEEGR).
In her main speech earlier in the day, she issued a rallying cry to Mr Osborne for measures in the forthcoming Budget to show the Government believes in the future of the North Sea.