British Oil and Gas Company Ithaca Energy Cuts Investment Due to Excess Income Tax
Ithaca Energy, one of the UK’s largest oil and gas producers, has slashed investment and is even talking about canceling a number of projects this year and next.
The reason is the excessive expenses associated with the payment of the windfall income tax, which London initiated about a year ago.
This tax has prompted many UK offshore companies to cut back on capex.
The reason is serious: after all, the increase in the windfall income tax to 35% makes you really think about whether it is worth working in the North Sea or is it better to invest somewhere in projects off the coast of Brazil, Guyana or in some other countries where foreign companies are welcome.
Among the giants of British oil and gas, not only Ithaca Energy thinks so. Harbor Energy also abandoned projects on the UK coast. The company did not want to participate in the last round of licensing, where about 100 permits were to be issued.
In its H1 results report, Ithaca Energy stated, “Until the fiscal regime is improved, investment in our operating and non-operating portfolio has been and will continue to decline.”
