Shell's Gorgon & Prelude LNG Projects Expected to Deliver $0 in Tax Revenue

Shell PLC is a multinational oil and gas company based in London, England, originally established in 1907 through the merger of the Royal Dutch Petroleum Company and The "Shell" Transport and Trading Company. In Australia Shell has been accused of using a variety of schemes to avoid paying its fair share of tax.

The Gorgon & Prelude LNG Projects

In March of 2021Michael West Media reported that Shell had predicted that it will never pay Petroleum Resources Rent Tax (PRRT), an Australian tax on the extraction of oil and gas resources payable once a project's income exceeds its losses, on the Gorgon and Prelude LNG projects.

Shell's 2020 financial accounts reported “unrecognised” PRRT losses of $US39.4 billion and “based on business forecasts at existing commodity price levels, and the annual augmentation of the unused PRRT losses, this amount is expected to increase in the near future.”

Essentially this suggests that Shell is unlikely to ever make a profit from the Gorgon or Prelude projects and will therefore never have to pay PRRT, resulting in the Australian government and its people receiving no royalties from a multinational conglomerate taking its resources.

As explained by Peter Milne:

"All companies in Australia are liable to pay company tax, at 40 per cent of profit for large companies like Shell, for the same reason individuals pay income tax: to contribute to the community they are part of. PRRT is an additional payment for a business input: oil and gas in the ground owned by the Australian Government that companies extract for profit. The Australian Government does not give free meat to butchers or free flour to bakers, but with the PRRT, it gives away vast quantities of gas to multinational LNG makers.

Sources & Further Reading

https://michaelwest.com.au/shell-predicts-free-gas-forever-from-gorgon-and-prelude-lng-projects/

https://michaelwest.com.au/shell-whats-the-scam/

https://michaelwest.com.au/shell-plays-australian-gas-customers-for-mugs/

https://michaelwest.com.au/shell-tax-ripped-out-as-in-house-deals-double/

https://michaelwest.com.au/shell-pumped-20-billion-a-year-from-motorists-but-paid-no-company-tax/

https://michaelwest.com.au/a-tale-of-two-fossil-superpowers-what-australia-can-learn-from-norway/

https://michaelwest.com.au/taxman-pursues-tax-dodger-shell-switzerland/

https://michaelwest.com.au/is-petrol-producer-an-empty-shell/