North Sea Oil: Norway’s Pumping, Britain’s Lagging #oil #risks
Amplify’d from blogs.wsj.com
The UK oil lobby says it’s all to do with tax. Norway’s fiscal system encourages companies to drill, baby, drill, because they get tax breaks on their exploration costs.
But it also has a lot to do with the kind of companies active on each side of the national divide. On the UK side, the big majors have reduced their exposure to the North Sea over the last decade or so as the basin has matured. They’ve been succeeded by a wave of independents, lured by low-cost licenses and other government incentives.
These players have been floored by the credit crisis. Strapped for cash, they’ve struggled to finance exploration. Many have deferred projects. A couple have gone bust. UK investment in the North Sea fell 20% between 2005 and 2008, despite the red-hot oil price.
the latest drilling statistics for the North Sea. In the UK part, drilling was down nearly 60% in the second quarter. In the Norwegian sector, it was up 50%.Read more at blogs.wsj.com
Open Intelligence says:
The UK could lead the industrial world into a low energy world. Do not invest in British car manufacturers; invest in solar electricity. Forgot: all the government’s money was spent covering bank losses.
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