Britain will offer new tax breaks to encourage investment in older oil and gas fields in the North Sea, finance minister George Osborne said on Friday.

The tax allowance will shield up to £250m of income from some projects in brown fields, or older sites, he said. That figure rises to £500m for projects in fields paying the petroleum revenue tax.

“It will give companies the incentive to get the most out of older fields, creating jobs,” Mr Osborne said in a statement.

He told the CBI in Scotland last night that the tax breaks would bring “new investment and jobs”.

In July, the Chancellor pledged hundreds of millions of pounds of tax breaks to encourage more drilling for gas off the coast of the UK. Hours after that announcement, British Gas owner Centrica pledged to plough £1.4bn into developing its Cygnus gas field in the North Sea.