North Sea oil summit to hear pleas for action

Industry body Oil and Gas UK is to call for “meaningful action” from government in order to tackle major challenges facing North Sea operators.

Chief executive Malcolm Webb will tell an oil and gas summit in Aberdeen on Monday that “an unpredictable and harmful business environment” has put the sector “at great risk”.

The body wants urgent tax cuts amid falling oil prices and rising costs.

It also wants a new oil and gas regulator in place as soon as possible.

The UK Treasury said it was working with industry leaders “as a matter of priority” to address the challenges the industry faces.

The summit, which has been organised by Aberdeen City Council, will be attended by local and national politicians as well as industry and union representatives.

Scotland’s First Minister Nicola Sturgeon and the UK government’s Scottish Secretary Alistair Carmichael will be among the participants.

The summit was called amid warnings the industry was in crisis.

A barrel of Brent crude has more than halved in price since its peak of $115 last summer. On Friday it was standing at less than $53 a barrel.

Last month, the chairman of the independent explorers’ association Brindex told the BBC the industry was “close to collapse”.

Robin Allan claimed almost no new projects in the North Sea were profitable with oil below $60 a barrel.

However, Sir Ian Wood, another leading industry figure, said Mr Allan’s warning was “well over-the-top and far too dramatic”.

Aberdeen City Council leader Jenny Laing, who is a Labour councillor, said the summit was aimed at coming up with “meaningful” responses to the oil price slump, and other challenges facing the industry.

In recent weeks hundreds of North Sea jobs have been cut by oil firms, including BP and Talisman Sinopec.

Both industry leaders and the Scottish government are calling for taxes to be cut further as a matter of urgency to help the sector deal with falling oil prices and higher costs.

Unions have also raised safety concerns over the number of job cuts being made in the industry.

Source-BBC