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Harbour Energy, the largest oil and gas producer in the British North Sea, has reportedly announced plans to cut its UK workforce by a quarter, equating to around 250 jobs, citing government policies.
The decision, affecting the Aberdeen unit, is driven by reduced investment due to the UK Government's stance on the North Sea fossil fuel industry, according to a report by Reuters.
The company's UK managing director, Scott Barr, was quoted by the news agency as saying: “The review is unfortunately necessary to align staffing levels with lower levels of investment, due mainly to the Government’s ongoing punitive fiscal position and a challenging regulatory environment.”
This move is another setback for Scotland's oil and gas sector, following Petroineos' recent cessation of crude oil processing at the Grangemouth Refinery.
Harbour Energy, which reported a loss of £93m in 2024 after a net profit of £45m in 2023, has called for UK Government reforms to the windfall tax, which is set to expire in 2030.
The tax rate was increased last October to 38%, bringing the total sector tax to 78%, one of the highest globally.
The UK Government aims to fund renewable energy projects with the revenue from the Energy Profits Levy.
However, since the levy's introduction, North Sea producers have been divesting assets, consolidating operations and looking to invest elsewhere.
A government spokesperson expressed its intention to support workers and communities affected by these commercial decisions.
In addition to workforce reductions, Harbour is reassessing the resources for its Viking carbon capture and storage project.
Delays in the government's Track-2 process, which seeks to establish two new carbon capture usage and storage clusters by 2030, have impeded progress. Viking is one of the projects awaiting a decision on government funding.
“We must take these difficult steps in response to the challenges presented by the current external environment,” Barr added.
In a separate development earlier this year, EnQuest agreed to acquire Harbour Energy’s Vietnam business for a headline value of $84m, with an expected payment of $35m upon completion.
This acquisition aligns with EnQuest's strategy to expand its international presence with assets that promise quick returns, low capital expenditure and reduced carbon intensity.
"Harbour Energy announces 250 job cuts at Aberdeen UK unit" was originally created and published by Offshore Technology, a GlobalData owned brand.
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