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was paid by only five oil and gas companies which owned the
largest and most profitable fields in the North Sea.
Because of the special allowances, small oil and gas
companies with interests in marginal fields typically owe no PRT
with regard to fields licensed to them.
Pre-existing licensees (i.e., companies such as Exxon to
whom North Sea licenses were issued prior to enactment of PRT in
1975) were obligated to pay PRT upon its enactment in 1975 and in
subsequent years even though they were in full compliance with
terms of their pre-1975 North Sea licenses. All PRT paid by
Exxon during the years in issue and the character of which is in
dispute in these cases was paid by Exxon with respect to fields
licensed to Exxon before 1975 and before PRT was enacted.
As a result of paying PRT, Exxon neither received any
special benefits under the North Sea licenses that it had been
issued before 1975, nor received any special benefits from the
United Kingdom in obtaining new North Sea licenses after 1975.
By 1979, with the rise of oil prices relating to the Iranian
Revolution, there was a general perception that the PRT rate was
too low and that the United Kingdom ought to be collecting more
PRT from oil companies operating in the North Sea. In 1982,
however, with a drop in world oil prices, there was a general
perception that the PRT rate was too high and that PRT and
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