Harbour Energy’s $32m profit constrained by UK’s windfall tax

London — Harbour Energy, the largest British North Sea oil and gas producer, reported on March 7 a net profit of just $32m for 2023, as the UK’s windfall tax for energy companies wiped out most of its pretax profit while lower natural gas prices and output dented revenue.

After the spike in energy prices in 2022, Britain imposed an energy profit levy (EPL) on oil and gas producers, which raised the tax rate to 75%.

Harbour Energy said its full-year profit before tax for 2023 totalled $597m.

That was down from $2.5bn in 2022 when net profit was only $8n, due largely to the $1.5bn set aside for the EPL.

On Wednesday, Britain’s finance minister Jeremy Hunt extended the EPL by another year to 2029.

The EPL also pushed Harbour Energy into a loss in the first half of 2023, leading it to cut its headcount in Britain, scale back North Sea spending, and seek to diversify its operations overseas.

Reuters