THE North Sea gas industry received a boost yesterday after an announcement on tax breaks unlocked investment worth more than £1 billion.
Energy giant Centrica said it would put £1.4bn into its Cygnus gas field, near Hartlepool, creating around 4000 jobs.
The move came hours after Chancellor George Osborne announced a £20 million a year tax cut to help improve the profitability of new so-called marginal fields.
The Coalition has been under pressure to help the industry since the much-criticised raid on North Sea oil and gas profits announced in its 2011 Budget.
The tax changes are designed to encourage companies to invest and increase confidence in the profitability of UK gas fields.
Making the announcement, the Chancellor said: "Gas is the single biggest source of energy in the UK.
"Today the Government is signalling its long-term commitment to the role it can play in delivering a stable, secure and lower-carbon energy mix."
However, some experts have expressed doubts that the tax breaks would be enough to encourage significant new investment.
Industry body Oil & Gas UK welcomed the announcement, saying that it made "absolute economic sense to promote oil and gas production from the resources we in the UK are fortunate enough to possess."
However, chief executive Malcolm Webb also called on the UK Coalition Government to promote investment in existing fields as well.
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