ROYAL Dutch Shell has received UK tax refunds worth around $100 million (£73m) after the costs of decommissioning the giant Brent field mounted.
In the oil giant’s latest report on payments made to governments, Shell revealed that the value of the reliefs it was awarded in 2020 was worth around $99.1m more than the $7.5m fees it paid to the UK authorities.
The disclosures highlight the value of the tax breaks that have been introduced to encourage activity in the North Sea.
The amounts paid to the Treasury have fallen amid tough times in the industry in recent years. The coronavirus crisis triggered another deep downturn in the North Sea., in which activity slumped following the sharp fall in oil prices between 2014 and 2016.
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Shell received $73m refunds in respect of work on Brent and other Northern North Sea projects last year.
The company has removed the topsides sections of three of the four giant platforms used on Brent.
Brent was brought into production in 1976. Output reached 700,000 barrels oil equivalent daily in 2001. It is thought the field has generated more than £20 billion tax revenues over the years, at current prices.
Shell paid $13.2bn in total to governments around the world last year. Nigeria received the largest total, $3.2bn.
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Shell said it expects to record a profit on its oil and gas exploration and production operations at group level in the first quarter after “capturing the upside from the current commodity price environment”. Oil and gas prices have risen since last summer amid growing confidence in the prospect of the economy recovering strongly from the damage caused by the pandemic.
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