ROYAL Dutch Shell received around $110 million (£87m) more back from the UK Government in respect of its oil and gas exploration and production activity than it paid in taxes last year, the company has revealed.

In a report on the payments it made to governments in 2019 the oil giant disclosed that it received tax rebates in respect of its UK North Sea business totalling $116 million. These dwarfed the $6.5m that the company paid in fees.

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The report highlights the value of the tax relief provided to firms in respect of the costs of decommissioning North Sea facilities.

Shell was paid $74.3m in respect of Northern North Sea decommissioning work last year.

The vast bulk of this related to work on the giant Brent field. Last year Shell removed the second of four platforms used on the field.

It received other tax refunds worth $42m.

The UK Government enacted generous tax reforms to try to encourage firms to invest in the North Sea after activity levels slumped in response to the sharp fall in the crude price between 2014 and 2016.

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The plunge in the crude price this year is posing huge challenges for the industry.

Shell invested heavily in recent years in big field developments West of Shetland..

The scale of the repayments made to Shell may provoke concern at a time when the public finances are set to come under strain.

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The Government has committed huge sums to helping keep businesses afloat amid the crisis caused by the coronavirus.

The chair of Shell UK, Sinead Lynch, noted recently that the company only decommissioned Brent after the field had generated around £20bn tax receipts.

The payments to governments report shows Shell paid $22.7bn in total to governments around the world in 2019.

The company paid $3.1bn to the Norwegian authorities last year

It paid most in Nigeria, where payments totalled $5.6bn, including the government’s share of production revenues.

Shell paid $1.3bn to the US authorities.

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