Chancellor of the Exchequer George Osborne says little about supporting UK oil and gas in his Autumn Statement but confirms the establishment of a GBP 1 billion shale gas wealth fund.
The Chancellor of the Exchequer’s Autumn Statement Wednesday covered a wide range of topics but said little about what more Her Majesty’s Treasury can do to aid the UK’s oil and gas industry amid the current downturn.
While there were announcements aplenty detailing H.M. Treasury help for the National Health Service, the housing sector and flood defences as well as increased cash for such entities as the Arts Council and UK Sport, George Osborne chose not to provide additional support in the form of further tax breaks to the beleaguered UK oil and gas sector.
Osborne did state that the Treasury is “supporting the creation of the shale gas industry by ensuring that communities benefit from a Shale Wealth Fund, which could be worth of up to GBP 1 billion ($1.6 billion)”. This was not “new” news, however, as it only confirmed the statement in July’s ‘Emergency Budget’ that the Chancellor planned to bring forward proposals to establish such a fund that would be designed to support local communities involved in shale gas extraction..
That Osborne is still demonstrating Treasury support for the development of a shale gas industry chimes with the Department of Energy and Climate Change’s announcement earlier this month that it would pursue an energy policy that will see natural gas play a central role in the UK’s future power generation plans. Energy Secretary Amber Rudd said on November 18 that in order to develop a cleaner and more secure energy network, she would consult on closing the country’s coal-fired power stations by 2025 while introducing more gas into the energy mix.
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