The Decommissioning Relief Deed dates back to a statement by the then Chancellor of the Exchequer, George Osborne, in September 2013.
Unanswered legal questions on North Sea decommissioning, including the potential cost to the taxpayer, will be addressed at an industry event tomorrow.
The mature phase of oil and gas operations on the UK continental shelf is proving to be more complex than we could have imagined even a few short years ago. It has long been recognised that, once a reservoir was depleted and the infrastructure associated with it redundant, decommissioning would be required in accordance with the UK’s international obligations. But it is now clear that, even as some reservoirs reach that point, new discoveries are being made and their development may depend on having access to existing infrastructure which otherwise would be decommissioned. The complex decisions involved in balancing the needs of new and future projects with the expectations of companies who want to decommission infrastructure is a matter for the Oil and Gas Authority working in conjunction with the Department for Business, Energy and Industrial Strategy.
A specialist in oil and gas law has warned that a lack of clarity over a strategy to maximise oil recovery from the North Sea could cause issues when it comes to decommissioning.