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New oil boom on cards: Holyrood

Category: Scottish Economy — Paul Morgan on March 28, 2013

Recent analysis by the Scottish government has suggested that the country could be in line for an oil boom over the next five years.

The prediction is made in the SNP’s first Oil and Gas Analytical Bulletin.

The report forecasts that by 2018, oil production in Scottish controlled waters could generate taxable revenue amounting to £57 billion.

The first minister, Alex Salmond said:

“It’s clear that Scottish oil and gas could generate more revenues than has previously been assumed.”

Indeed, the scenarios examined – and based on recent investment and price trends – identify the potential for total revenues over the next six years of between £41 and £57billion.

The forecasts go further still, suggesting that over half of all UK Continental Shelf reserves have yet to be extracted. Over 90 percent of the UK shelf is in Scottish waters.

With commercial finance in Scotland increasing in the industry, Salmond went on to say that oil and gas could effectively fund Scottish independence.

However, opposition parties refuse to accept the findings. They say that the UK’s Office for Budget Responsibility has far lower projections.

The leader of the Scottish Liberal Democrats, Willie Rennie, said:

“In public, the SNP desperately insist the boom years are ahead, but in private we know they are deeply concerned that oil revenues are volatile, unpredictable and falling.”

A recently revealed draft discussion in government showed that there was widespread concern in predicting North Sea oil revenues. It did point to greater stability and control in the country if Holyrood had management of the revenue generated though.

'Disclaimer: The information contained in these articles is of a general nature and no assurance of accuracy can be given. It is not a substitute for specific professional advice in your own circumstances. No action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a consequence of the material can be accepted by the authors or the firm.

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