• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 1 day How Far Have We Really Gotten With Alternative Energy
  • 4 days Can Solar Panels Regenerate Prairies?
  • 4 days Canada’s Carbon Capture Ambitions Have Hit A Roadblock

Breaking News:

Chevron LNG Workers End Strike

Why Putin Met Kim Jong-Un

Why Putin Met Kim Jong-Un

Following the Wagner uprising and…

An Apparently Unstoppable Oil Price Rally

An Apparently Unstoppable Oil Price Rally

There appears to be no…

Apache Halts Drilling In The UK North Sea

Apache Corporation is halting drilling in the UK North Sea, cutting jobs in Britain, after the latest change to the UK Energy Profits Levy, commonly referred to as the windfall tax.

The U.S.-based corporation, which is one of the top ten producers of oil and gas in the UK North Sea, has said that the windfall tax and the challenging regulatory environment are making its UK operations less competitive.

Apache has also confirmed the suspension of drilling activities will lead to job losses in its UK division.

“We are reassessing our investments, as we consider the challenging UK macro environment with its increasingly costly and burdensome tax and regulatory regime,” a spokeswoman for Apache told media.

“Given the business climate for the oil and gas industry in the UK, these assets have become less competitive in comparison to the rest of our portfolio,” she said.

Last week, the UK government put a price floor to the windfall tax, but this price floor will only trigger a return to a 40% marginal tax rate on North Sea oil and gas production, compared to the current tax rate of 75%, if both average oil and gas prices fall to, or below, $71.40 per barrel for oil and £0.54 per therm for gas, for two consecutive quarters.

According to Ryan Crighton, policy director at Aberdeen & Grampian Chamber of Commerce, UK gas prices are unlikely to drop to those levels,

“So, basically, it will never be triggered.”

“The Chancellor needs to work with the industry to get this right, because billions of pounds worth of investment and thousands of new jobs could be created in the North Sea in the right conditions,” Crighton said.

“The alternative is a levy which risks accelerating the decline of our oil and gas sector at a pace which jeopardises the skills and investment required to deliver the UK’s net zero plans.” 


After the UK raised the windfall tax to 35% at the end of last year, Harbour Energy, the biggest oil and gas producer in the UK North Sea, backed out of the latest licensing round aimed at awarding more than 100 new licenses. Shell has said it would be re-evaluating each project comprising its $30.5 billion (25 billion pounds) planned investment in the UK energy system, and TotalEnergies has said it would slash its investment in the UK by 25%.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News