North Sea oil rig

The value of tax receipts from oil and gas firms operating in the North Sea fell to just £35 million in the 2015/16 financial year, according to HM Revenue & Customs.

HMRC said it received £538m in corporation tax from firms in the North Sea, but they were offset by Petroleum Revenue Tax rebates worth £503m.

As recently as the 2014/15 financial year, the North Sea generated £2 billion in corporation tax. And it raised £11bn just four years ago. But the £35m figure is its lowest since production first started.

However, the substantially lower tax receipts mirror the plunging oil prices suffered by the industry over the past near-two years. In the summer of 2014, Brent crude oil was trading at around $115 per barrel, but it is now $40, having fallen as low as $28 in the first few weeks of 2014.

The Office for Budget Responsibility has forecast negative tax returns from the North Sea in the coming years.

Mike Tholen, economics director at UK Oil & Gas, said: "At around $40 per barrel, oil is still more than 60% lower than it has been over the last three years.

"In these conditions, the UK North Sea industry will continue to struggle to sustain its current scale.

"More than £330bn in 2014 money has been paid to date on UK oil and gas production, however, HM Treasury has noted that tax take on production will fall in 2015-16 and fall further by 2021.

"Despite the projected fall in production taxes which is a consequence of the current low oil prices, industry will remain a significant employer, provider of energy security, hub of innovation and leader in the export of goods and services to overseas markets."