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Oil and gas taxation: decommissioning relief deeds

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The government signed 11 new decommissioning relief agreements in 2016/17, bringing to 86 the number of deeds entered into since October 2013. At the end of 2016/17, 83 agreements were in force.

These deeds are the government’s contractual approach to providing oil and gas companies with certainty on the level of tax relief they will receive on future decommissioning costs. Oil & Gas UK, the trade association for the industry, estimates these deeds have released more than £5.7bn of capital for investment elsewhere.

The government made two payments in 2016/17 totalling £5.4m, as a result of a company defaulting on their decommissioning obligations. The Treasury reports to Parliament every year on progress with the deeds

Issue: 1393
Categories: News