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On 14 February 1973 the Parliamentary Public Accounts Committee issued its report “North Sea Oil and Gas� (HC122). It reflected a comprehensive review of the oil industry, government administration, and the exchequer implications.

It noted that: “Under the present arrangements the UK will not obtain either for the Exchequer or the balance of payments anything like the share of the “take� of oil operations on the continental shelf that other countries are obtaining for oil within their territories. Indeed at present the only certain revenue from a large number of the North Sea operations is the royalty and licence payments. This situation needs close review…�. It was particularly concerned that profits from continental shelf operations could be offset by extraneous losses and capital allowances.

1974 White Paper

»Ê¹ÚÌåÓýapp Department of Energy issued on 11 July 1974 a White Paper “United Kingdom Offshore Oil & Gas Policyâ€� (Cmnd 5696). It set out the Government’s two main objectives, to secure a fairer share of profit for the nation and to maximise the balance of payments benefit, while ensuring the oil companies received a suitable return on their heavy capital investment in exploration and production.

»Ê¹ÚÌåÓýapp White Paper proposed that the Government should introduce what was to become Petroleum Revenue Tax and the Corporation Tax ring fence. »Ê¹ÚÌåÓýappse formed the basis of the first Oil Taxation Bill.