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MPs warn about offshore break-up costs

No adequate plans have been made to exploit the UK’s lead as the first major country to try large-scale decommissioning of offshore oil and gas structures.

The warning has come from the public accounts committee, which also said significant uncertainty remained about the future cost to taxpayers of decommissioning because of the tax reliefs involved.

MPs on the committee said in their report: “There is potential for the UK to become a global leader in decommissioning skills and technology, but we are concerned that the Department for Business, Energy and Industrial Strategy (Beis) does not yet have a clear plan for maximising the potential economic benefits.”

It said the cost of decommissioning could be anywhere between £45bn and £77bn.

There was also concern that the fracking industry has been allowed to start work without the Government having decided how its infrastructure would eventually be decommissioned.

Committee chair, Labour MP Meg Hillier, said: “Taxpayers will incur costs running to billions for oil and gas decommissioning, but it is far from clear what these costs will be in practice.

“The Oil and Gas Authority must bring greater certainty to its cost estimates. Together with Beis, it should be transparent about how these estimates measure up to reality and explain exactly what impact it is having on reducing costs.”

In 2017 Veolia set up an oil rig decommissioning facility at Great Yarmouth.


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