Shell and BP paid zero tax on North Sea gas and oil for three years

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Shell and BP, which unneurotic nutrient much than 1.7bn tonnes of greenhouse gases a year, person not paid immoderate corp taxation connected lipid and state accumulation successful the North Sea for the past 3 years, institution filings reveal.

The lipid giants, which person an yearly planetary footprint of greenhouse gases much than 5 times bigger than Britain’s, are benefiting from billions of pounds of taxation breaks and reliefs for lipid and state production.

Shell and BP paid nary corp taxation oregon accumulation levies connected North Sea lipid operations betwixt 2018 and 2020, and claimed taxation reliefs of astir £400m, according to yearly “payments to governments” reports analysed by the Observer.

Over the aforesaid three-year period, they paid shareholders much than £44bn successful dividends.

Oil giants look to exploit caller areas successful the North Sea

A petroleum gross taxation of 35% was efficaciously scrapped by the past chancellor George Osborne successful 2016 and lipid giants tin assertion billions of pounds successful payer handouts for decommissioning rigs.

The North Sea is present 1 of the astir profitable areas successful the satellite for lipid and state production, aft taxation cuts by the authorities to promote production.

Shell and BP person acceptable targets to execute nett zero c emissions by 2050 by investing successful cleaner energy, but accidental the UK volition proceed to request lipid and state from the North Sea, which besides supports thousands of jobs.

Climate campaigners are present challenging the UK taxation authorities successful a precocious tribunal case. They privation the payouts to beryllium scrapped and a prohibition connected immoderate caller lipid and state projects successful the North Sea to assistance chopped c emissions.

Philip Evans, lipid and state campaigner for Greenpeace UK, said: “It’s outrageous that arsenic the UK prepares to host planetary clime talks successful Glasgow, we inactive person 1 of the lowest effectual taxation rates successful the satellite for lipid extraction.

“We’re giving taxation breaks worthy billions of pounds to companies that person been fuelling the clime exigency for decades.”

There are astir 180 lipid rigs successful the North Sea and the assemblage has generated astir £360bn successful nett taxation revenues since 1970, which is astir £7.2bn a year.

The UK has immoderate of the lowest lipid taxation rates successful the world. An investigation by probe institution Rystad Energy successful January recovered the UK is present the astir profitable state successful the satellite for the improvement of lipid and state “mega-projects”.

Taxpayers volition ft a measure of much than £18bn for the decommissioning of the lipid and state infrastructure successful the North Sea up to 2065 – made up of taxation repayments and a simplification successful offshore corp tax. Campaigners privation the handouts to beryllium scrapped and utilized for investing successful cleanable energy.

Kwasi Kwarteng, the concern secretary, faces a ineligible situation implicit the taxation handout to lipid and state operators by campaigners. Paid to Pollute, a radical of biology organisations, says that the payer handouts to lipid and state companies are unlawful due to the fact that they struggle with the UK’s ineligible work to execute nett zero emissions by 2050. A judicial reappraisal is owed to beryllium heard earlier the extremity of the year.

Gabrielle Jeliazkov, a campaigner astatine Platform, a UK radical that investigates the societal and biology effects of the planetary lipid manufacture and is supporting the ineligible case, said: “The authorities has spent excessively agelong backing lipid giants done taxation breaks and subsidies. It has had devastating consequences for the climate.”

Shell and BP besides look beardown absorption implicit caller projects successful the North Sea. A study published past week by Friends of the Earth and the New Economics Foundation recovered the lipid and state manufacture is preparing to question support for 30 offshore lipid and state projects by 2025.

Shell has defended plans for the Cambo project, a arguable oilfield disconnected Shetland that contains astir 800m barrels of lipid and is awaiting support from the Oil and Gas Authority, a authorities licensing body. Greenpeace mislaid a ineligible bid this period for the authorities to revoke the licence for BP to drill astatine the Vorlich oilfield successful the North Sea, which started accumulation successful November past year.

It was reported by Reuters past week that Offshore Petroleum Regulator for Environment and Decommissioning had rejected Shell’s plans to make the Jackdaw gasfield successful the North Sea aft considering its biology statement.

A Shell spokesperson said: “Our full lipid accumulation already peaked successful 2019 and we expect it to proceed declining, including done divestments. We’re already investing billions of dollars successful low-carbon energy. The North Sea Transition Deal agreed earlier this twelvemonth besides maps retired however the assemblage volition trim emissions successful enactment with the government’s nett zero targets.” The institution said it paid nary corp taxation connected North Sea accumulation past twelvemonth due to the fact that of taxation losses successful erstwhile years.

A BP spokesperson said: “All BP’s North Sea assets are owned by companies that are taxable to UK taxation successful accordance with UK law. Over the years, BP has contributed implicit £40bn successful taxes to the UK authorities from its North Sea business.

“In caller years, successful enactment with longstanding UK taxation regulations, taxation alleviation connected the important investments we person precocious made successful the North Sea concern and the challenging terms environment, including the steep lipid terms falls successful 2015 and 2020, person meant we person paid nary North Sea firm taxes.”

A authorities spokesperson said: “The UK lipid and state manufacture has paid astir £375bn successful accumulation taxes to day – with companies successful the North Sea taxable to header rates that are much than treble those paid by different businesses.

“Relief for decommissioning costs is simply a cardinal portion of the UK’s taxation system, contributing to the harmless removal of lipid and state infrastructure from our earthy situation whilst ensuring companies are encouraged to put successful the UK.”