Labour’s plans for the oil and gas sector have gone largely unscrutinised – thanks to the sector being a piñata for quick revenue-hungry chancellors. There aren’t many sweets left in it as the sector reaches absolute breaking point…

Under climate zealot Ed Miliband, Labour is proposing an increase to the already eye-watering windfall tax to 78% (from 75%) until 2029, as well as blocking any new licences. American international investment bank Stifel has conducted research into the effects of the tax plans. They have found that:

• An increase in the windfall tax to 78% and the removal of investment allowances would yield an extra £6.5 billion by 2029, not the expected £11 billion.
• From 2030 onwards, tax revenue would drop significantly, with a projected loss of £20 billion in tax income over the remaining life of the North Sea energy fields.
• The industry is likely to see a £20 billion reduction in capital investment by 2035 which leads to a 50% drop in production by 2030.
• According to projections, around 100,000 jobs could be lost in the sector by the next general election in 2029.
• The UK would become increasingly reliant on imports, with 80% of its gas demand met by imports by 2030, up from the current 55%.

Apart from the loss to energy security, without the North Sea our Co2 emissions would be higher, because production of oil and gas is not highly carbon intensive. Transportation/importation of oil and especially gas (specifically LNG) is where carbon intensity rises. So carbon emissions across the world would rise. The story of net zero writ large…

Read the full report below: