§ Mr. Mellishasked the Chancellor of the Exchequer whether he is satisfied with the operation of the North Sea fiscal regime as it affects the production of associated gas from oil fields and the use of shared pipelines in the North Sea; and if he will make a statement.
§ Mr. Joel BarnettThe oil industry has made representations about the way the tax and royalty rules affect the economics of the production and disposal of gas which is produced in association with oil, and the use of shared pipelines, in the North Sea. Officials of the Inland Revenue the Treasury and the Department of Energy, are jointly considering the possible need for clarification of the existing law and for changes in the law and will be making recommendations to Ministers in due course. The issues involved are complex and the review can be expected to take some months to complete. In the course of the review officials will consult the companies affected and the British Gas Corporation.