Business practices and behaviours

PILOT has challenged the industry to devise codes of practice to influence behaviours that promote social responsibility and business efficiency. There are currently three in operation for the offshore sector:

Supply Chain Code of Practice - launched initially in March 2002 to drive an improvement in behaviours during contractual negotiations and the code was revised and updated to build on the past successes and re-launched in 2006. The code's new streamlined approach tackles the commercial process in three stages (Plan, Contract and Perform & Pay) and its best practice guidelines help individual companies to improve performance, eliminate unnecessary costs, add value and boost competitiveness.

The 2005 survey commenced in May 2006.

Commercial Code of Practice - launched in 2002 to promote positive commercial behaviour and to speed up transactions between licence holders.

The 2005 survey commenced in March 2006, with results due in June 2006.

Infrastructure Code of Practice - launched in September 2004 to promote business behaviours that would improve the usage of existing infrastructure; key changes were ensuring transparency of information and incorporating a dispute resolution process (ARN's). A full survey on ICoP usage and usefulness is being conducted in 2006, with results due in June 2006:

• Over 50 companies have signed the ICoP, including all UKOOA members, which cover all currently operating systems - information is publicly available at www.ukdeal.co.uk
• 38 Automatic Referral Notices (ARNs) have been submitted to the DTI

Social responsibility reporting

The number of companies operating on the UKCS subscribe to non-financial corporate reporting is about 18 and includes the following companies:

Amerada Hess, BG Group, BHP Billiton, BP, Centrica, Chevron, CNR International, ConocoPhillips, ExxonMobil, Gaz De France, Marathon Oil Corporation, Nexen, Petro-Canada, Premier Oil, RWE Dea, Shell, Talisman Energy, Total.

Contribution to UK public finances

The UK economy has benefited from over £215 billion in 2005 prices in North Sea taxes since 1968. Tax receipts have more than doubled from £4.5 billion in fiscal year 2003-04 to £9.6 billion in 2005-06 as a result of high oil prices and successive changes in the tax regime. Treasury projections for tax receipts in 2006-07 take into account the December 2005 tax change which raised the effective tax rate from 49% to 56% and are based on $57 oil in 2006.

Figure 17: UK North Sea Taxes (2005 Prices), 1991-2007