Property Rights, Economic Rents, BNOC, and North Sea Oil
The British National Oil Corporation (BNOC) was established in 1976, formally with the passing of the 1975 Petroleum and Submarine Pipelines Bill and practically as the result of negotiations between the UK government and the oil companies. Established with an initial capital of £600 million, BNOC was required to pay all of its revenues into a new account, the National Oil Account, and it was able to draw on this account to finance its activities. Potentially, the Petroleum and Submarines Pipelines Act gave the UK government virtually total control over the exploration and development of North Sea oil resources. In fact, the government chose to confine BNOC’s ...