Oil revenues 'wiped out' by costs to scrap rigs

The cost of decommissioning North Sea oil rigs and pipelines after the oil runs dry could hit £24 billion for the taxpayer, it has emerged.

The cost of decommisioning North Sea rigs could reach 24bn.

This is 50 per cent higher than previously estimated and could wipe out the remaining tax revenues which the Treasury hopes to get from the industry.

It would also prove a headache for the independence campaign with North Sea oil pivotal to the economic case despite the recent price crash.

Oil companies are set to spend about £53 billion from this year winding down North Sea operations - but almost half of this will be recouped from the Treasury through tax relief. Analysts Wood Mackenzie said tax relief on scrapping platforms and pipelines would “wipe out” the government’s expected future income from the North Sea.