Oil baron warns of trouble in the North Sea

Sir Ian Wood fears combination of lower prices and lack of funding will affect new projects, and bosses call for tax cuts

Oil industry bosses are urging Alistair Darling, the chancellor of the exchequer, to ease the tax burden on North Sea oil and gas companies or risk more than 50,000 job losses in the industry, centred on Aberdeen.

Sir Ian Wood, chairman of Wood Group, is calling for the UK government and the industry to work together to develop an emergency plan to minimise a serious loss of momentum. He is calling for specific measures to promote exploration and appraisal drilling, to encourage new small field developments through cuts in supplementary corporate tax, and the introduction of measures to boost the liquidity of the smaller industry players who are struggling under the weight of the credit crunch.

Sir Ian said: