Small companies servicing a UK shale gas industry could generate more than £1.35 billion in tax receipts, according to industry figures released today.
A study by the Onshore Energy Services Group (OESG), which represents the UK oil and gas supply chain, predicted that at peak production, the workforce would contribute taxes of £1.33 billion and tax on business profits could yield another £0.02 billion
The figure assumed that UK shale gas would develop in the way forecast in an industry-funded report by the Institute of Directors, peaking in 2024. It also assumed that supply chain jobs would grow, as predicted by EY, from 1,533 in 2016 to a peak of 64,879 in 2024, with 55% of in small and medium-sized businesses.
Between 2016 and 2024, the OESG estimated employment taxes from the shale gas supply chain could exceed £6 billion.
Speaking at the Shale Gas and Oil Forum this afternoon, the OESG chief executive, Lee Petts, said: “British SMEs [small and medium-sized enterprises] in the existing onshore oil and gas supply chain have both the capabilities and the appetite to play a big role in making shale gas a truly British success story.”
He said the estimated tax receipt in 2024 would be enough to pay for 19,543 GPs, or 45,006 nurses, or 50,087 teachers.
Mr Petts said SMEs were more likely to generate jobs because they had to take on staff to grow. He also said they were more likely to be trusted by people.
“The prevalence of SMEs means people will know someone who owns or works for one of those small companies.”
OESG wants the government to use Wednesday’s budget to protect the future of UK shale supply chain SMEs.
- A study by the UK Energy Research Centre, published last year, found that renewable energy and energy efficiency created up to 10 times more jobs per unit of electricity generated or saved than fossil fuels.