Gordon MP Malcolm Bruce today asked the Prime Minister in the House of Commons to ensure Treasury and Energy Ministers to engage fully with the oil and gas sector, ensuring that key investment in the North East will not be lost as a result of last week’s Budget.

Speaking in Prime Ministers Questions, Mr Bruce asked the PM:

“In the light of the announcement by Statoil this week that they are cancelling £6bn of investment in the North Sea following the budget, will the Prime Minister ensure that his ministers in the Treasury and DECC engage with the industry to explain how the field allowances might be adjusted to ensure that this valued investment goes ahead and jobs are not lost.”

The Prime Minister responded:

“I will certainly look very carefully at the point that he makes, the point I would raise about Statoil is that when you look at the regime in Norway they actually have higher taxes on petrol and on duties than we do in the UK and I think the key point I would make to my Rt Hon friend is that when the companies in the North Sea made investment decisions the oil price was around $65 a barrel it is now around $115 a barrel and I think the break we are giving to the motorist by cutting petrol tax- including for people in his constituency- many of whom rely on their cars, I think will be hugely welcome.”

Afterwards Mr Bruce added:

“It is perhaps predictable that the Prime Minister chose to defend his Chancellor’s policy, but he did indicate that the Government would look to liaise with the sector, which I welcome.

“What I alongside my colleague Sir Robert Smith MP will be doing is to make representations on behalf of the industry if they feel their field allowances are at risk. We also want to learn more about the models used to extract the figure the Government is suggesting in terms of a threshold, as well as what mechanism will be in place to limit the taxation on the sector when the price of oil or gas falls below that threshold.”