United Kingdom Upstream Fiscal and Regulatory Report - Autumn Budget 2017 Introduces Transferable Tax History for Late-life Assets

 Published On: Dec, 2017 |    No of Pages: 29 |  Published By: GlobalData | Format: PDF
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Summary

"United Kingdom Upstream Fiscal and Regulatory Report - Autumn Budget 2017 Introduces Transferable Tax History for Late-life Assets", presents the essential information relating to the terms which govern investment into United Kingdom's upstream oil and gas sector. The report sets out in detail the contractual framework under which firms must operate in the industry, clearly defining factors affecting profitability and quantifying the state's take from hydrocarbon production. Considering political, economic and industry specific variables, the report also analyses future trends for United Kingdom's upstream oil and gas investment climate.

Scope

- Overview of current fiscal terms governing upstream oil and gas operations in United Kingdom
- Assessment of the current fiscal regime's state take and attractiveness to investors
- Charts illustrating the regime structure, and legal and institutional frameworks
- Detail on legal framework and governing bodies administering the industry
- Levels of upfront payments and taxation applicable to oil and gas production
- Information on application of fiscal and regulatory terms to specific licenses
- Outlook on future of fiscal and regulatory terms in United Kingdom

Reasons to buy

- Understand the complex regulations and contractual requirements applicable to United Kingdom's upstream oil and gas sector
- Evaluate factors determining profit levels in the industry
- Identify potential regulatory issues facing investors in the country's upstream sector
- Utilize considered insight on future trends to inform decision-making

1 Table of Contents
1 Table of Contents 1
1.1. List of Tables 3
1.2. List of Figures 3
2. Regime Overview 4
3. State Take Assessment 7
4. Key Fiscal Terms 8
4.1. Upfront Payments 8
4.1.1. Rentals 8
4.1.2. Royalties (Abolished January 1, 2003) 10
4.1.3. Royalties - Onshore Northern Ireland 10
4.2. Petroleum Revenue Tax 10
4.2.1. Application of Petroleum Revenue Tax 10
4.2.2. Supplement 10
4.2.3. Oil Allowance 11
4.2.4. Tariff Receipts Allowance 11
4.2.5. Cross-Field Allowance 11
4.2.6. Safeguard 11
4.2.7. Provisional Expenditure Allowance (Abolished from July 1, 2009) 12
4.3. Corporation Tax 12
4.3.1. Ring Fence Corporation Tax 12
4.3.2. General Corporation Tax 13
4.3.3. Deductions and Depreciation 13
4.3.4. Mineral Extraction Allowance 14
4.3.5. Ring Fence Expenditure Supplement 14
4.4. Supplementary Charge 14
4.4.1. Application of Supplementary Charge 14
4.4.2. Investment Allowance 15
4.4.3. Cluster Allowance 16
4.4.4. Onshore Allowance 16
4.4.5. Previous Field Allowances 16
4.5. EU Emissions Trading Scheme 18
4.6. Customs Duties 18
4.7. Value Added Tax 18
5. Regulation and Licensing 19
5.1. Legal Framework 19
5.1.1. Governing Law 19
5.1.2. Contract Type 20
5.1.3. Title to Hydrocarbons 20
5.2. Institutional Framework 21
5.2.1. Licensing Authority 21
5.2.2. Regulatory Agency 21
5.3. Licensing Process 22
5.3.1. Licensing Rounds 22
5.3.2. Out-of-Round Applications 22
5.3.3. Applicant Requirements 22
5.3.4. Work Program Proposals 23
5.3.5. Application Fee 23
5.3.6. Application Assessment 23
5.4. License Terms 24
5.4.1. Duration 24
5.4.2. Relinquishments 25
5.5. Restrictions on Hydraulic Fracturing 25
6. Outlook 26
7. Appendix 28
7.1. Contact Us 28
7.2. Disclaimer 28

1.1 List of Tables
Table 1: Regime Overview 4
Table 2: United Kingdom, “Innovate” Seaward License Rentals (£/km2), 2017 and 2016 8
Table 3: United Kingdom, License Rentals (£/km2), Pre-2016 Licenses 9
Table 4: United Kingdom, Ring Fence Corporation Tax Rates (%), 1975-2017 12
Table 5: United Kingdom, Corporation Tax (Main Rate), 2000-2016 13
Table 6: United Kingdom, Supplementary Charge, 2002-2016 15
Table 7: United Kingdom, Current Licenses, License Duration (years) 24
Table 8: United Kingdom, Previous Licenses, License Duration (years) 24
Table 9: United Kingdom, Relinquishment Requirements, Pre-2016 Licenses 25

1.2 List of Figures
Figure 1: Regime Flow Chart - UK (excluding onshore Northern Ireland) 5
Figure 2: Regime Flow Chart - Onshore Northern Ireland 6
Figure 3: United Kingdom,Indicative NPV10/boe, IRR, and State Take Comparison - Regional Peers, 2017 7
Figure 4: United Kingdom, Legal Framework 19
Figure 5: United Kingdom, Institutional Framework 21


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