OIL giant Shell “kept government in the dark” over the £1.3 billion cost to the treasury of its new joint venture with Equinor, according to records released to Global Witness.

Minutes of meetings released under freedom of information show that Energy Security and Net Zero secretary Ed Miliband and representatives of Shell met to discuss the merger to form Adura.

While the records show Mr Miliband questioned the reasons for the deal, they also show that Shell neither revealed who it was merging with — Norwegian state-owned Equinor — or that the arrangement stood to cut its tax bill by £1.3bn.

Campaigners say Adura, launched this week, is an example of “loss-buying,” an arrangement where a company such as Shell, which has raked in billions in profit over recent years, forms an arrangement with a loss-making one such as Equinor to offset tax liabilities.

Such practices were recently cited by the Office for Budget Responsibility as a key factor in tax revenue from the North Sea being £2.5bn lower than forecast earlier in the year.

Global Witness senior investigator, Jonathan Noronha-Gant said: “These records show Shell kept government in the dark about what it really wanted from its new North Sea oil venture.

“We now need an urgent investigation into this huge oil giant tax dodge.”

Stop Rosebank’s Lauren MacDonald said: “The creation of Adura doesn’t just tinker with the amount of tax Shell has to pay, this is serious money — money that could be invested in public services, in helping to bring down everyone’s energy bills, in helping energy workers move into clean energy jobs. 

“Instead, it will go to Shell executives and its shareholders.

“When you hear an oil giant complain about taxes, just remember the £1.3bn tax dodge that Shell is attempting to pull off.”

Fossil Free London’s Robin Wells, added: “Last year, Shell paid zero tax on North Sea drilling — but instead received £12.4 million back from the government. 

“And for years Shell’s executives have rubbed their hands over the enormous tax breaks served up by the UK government. 

“Now, please sirs, Shell and Equinor want some more. Only Fagin and Bill Sikes could create a dodgier joint enterprise.”

A government spokesperson said: “This is a commercial decision by Shell. We don’t comment on the tax affairs of individual companies.”