Treasury bosses have said that North Sea reforms announced by George Osborne during the Budget are worth £1bn to the oil and gas industry over the next five years.
The chancellor said that he would slash supplementary charges from 20% to 10% and ‘effectively abolish Petroleum Revenue Tax’ as he delivered his eighth Budget at the House of Commons.
The Treasury hopes the move will support the industry "for generations to come".
In a barb aimed at the pro-independence Scottish National Party, he said: "We are only able to provide this kind of support to our oil and gas industry because of the broad shoulders of the United Kingdom."
The Treasury said the cuts 'help support the industry through the challenging commercial conditions caused by the steep fall in oil prices benefiting those UK jobs supported by the oil and gas industry – nearly half of which are in Scotland'.
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The decision to cut the supplementary charge on oil and gas from 20% to 10% prompted Tory MPs to gesture wildly at the SNP benches, urging them to support the move.
Ministers estimate there are between 11 and 21 billion barrels of oil equivalent left to recover in the North Sea.
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