Harbour Energy Navigates EPL Hike with Strong Profit Outlook

Harbour Energy, the largest UK North Sea oil and gas producer, reported a net profit for the first half of the year, reversing a previous loss. The company has adjusted its 2024 production outlook following the UK government's tax hikes targeting energy producers. Despite a production dip, rising crude prices boosted performance.

Harbour Energy, the UK's leading North Sea oil and gas producer, announced a net profit for the first half of the year, rebounding from a previous loss. The company also narrowed its full-year 2024 production outlook, following new tax increases from the UK government.

In 2022, Britain imposed an energy profit levy (EPL) on oil and gas producers, slashing Harbour's profits. The new Labour government is set to increase EPL by 3% to 38% on Nov. 1, making it one of the highest global tax rates on oil and gas activities. To mitigate UK dependence, Harbour struck an $11.2 billion deal for Wintershall Dea's non-Russian assets, expected to finalize in the fourth quarter.

Harbour's profit before tax for the first six months was $392 million, with a net tax payment of $157 million, mostly due to EPL. While production fell 19% to 159 kboepd due to shutdowns, higher crude prices offset this decline. The company projects 2024 production between 155 and 165 kboepd, reflecting effective maintenance and capital project progress.

(With inputs from agencies.)