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GA, pls provide the source of your comment that some entity has taken the (UK) government to court over the EPL.

All, calm down!

To add, BP and Shell's are both about 70 times bigger than Enquest in terms of WW Hydrocarbon production.

As the EPL has a massively disproportionate effect on Independent UK Hydrocarbon producers, should they be pushing more for an annual EPL exempt amount, say 100,000 MBOEPD, than (or as a well as) for a floor price?

As an example, grosso modo, BP and Shell produce 4% of their WW in the UK, whereas for Enquest it is approaching 90%.

Many UK Independents are “real” UK-based companies as most of their staff and production is in the UK and, as such and according to their means, have shown strong commitment to the UK. Due to their size they are also the most vulnerable (many risked going belly-up during Covid lockdowns) and most likely to reduce UK investment due to the EPL. They also don’t have the financial support provided from UK downstream activities the Supermajors have and which are not hit by the EPL.

The UK produces around 0.9 MBOEPD and consumes around double this. Consumption will decline but only slowly. If energy security is really desired then the UK Independents are exactly the companies which need to be motivated to maintain/increase production. Apart the production, the jobs retained/created will increase GDP and keep skills relevant for the transition. They are also the most nimble to modify their activities to support the transition.

The resulting reduction in EPL would be compensated by the extra standard tax paid on the increased production plus the tax resulting from the increase in GDP. To further compensate, if needed, a modest extra tax could be placed on downstream activities together with a price cap on the price of fuel at the pump. (As pointed out before, the biggest beneficiary of the increase in oil prices has been the UK Treasury.)

Pipe dream or possibility that an EPL exempt production amount could be arranged at some point?

See https://www.msn.com/en-gb/money/other/energy-industry-faces-death-by-a-thousand-cuts-warns-major-power-supplier-to-britain/ar-AA17mS9U?ocid=msedgntp&cvid=3d2959366f12421a9438b0a4e4470925
More from the electricity generators standpoint but much equally relevant to O&G companies and investment in the UK. A head of steam opposing the WFT and highlighting the risks it brings appears to be emerging across industries. Can the interests of the electricity generators and hydrocarbon producers form an aligned pressure group? I think they can, with the focus on energy security, gaining investment/growth, keeping jobs and associated skills and taxes in the UK, and sourcing the required "transitional" hydrocarbon energy in the least carbon emitting way and from democracies/rule of law jurisdictions.
I especially liked: "The Chancellor increased a so-called Energy Profits Levy on oil and gas giants in the Autumn Statement and introduced a similar tax on electricity generators until 2028. While Mr Glover said he had received assurances from Mr Hunt that the tax would end as planned in 2028, he noted that Mr Hunt could not "bind future chancellors or future governments"."
That a "here today gone tomorrow" Chancellor commits to something he or his party cannot be sure of being in a position to decide about exposes their smoke and mirrors way of operating (and that they treat people as stupid).
Have a nice Sunday!

In case not seen:
https://www.offshore-energy.biz/oeuk-calls-for-uk-windfall-tax-on-oil-gas-players-global-profits-deliberately-misleading/
This dangerous misinformation should be challenged and the competence of the perpetrators exposed. Guess tho… this is politics and similar happens with in many areas. Sad state of affairs.

PYUECK, they are waiting to reach 0,5 net.debt:Ebitda so they can announce shareholder dividend payment or share buy-backs.
Has been said here several times that IR said the Ops Update would be mid-Feb.

mrc, certainly agree with your point about changing the rules mid-game, but I also think for risky long-term capital intensive projects in a cyclical/transitioning/unliked sector a 75% tax rate incentivises to look elsewhere to place capital.
As for Kinnock's comments... cheap, disgraceful, dangerous.

ukbbb, romaron, agree with most of what you say and I too live in hope. However, unless there is a some concrete action then I won't believe. The WFT is not going away and the only thing I can imagine which would be sufficient action to turn hope into belief is the introduction soonest of a reasonable WFT floor price which is also accepted by Labour. Otherwise... why would a logical investor put big money into "new" NS exploration/production knowing that profits will end up eventually being taxed at 75% or more whatever the price of oil? The Risk:Reward just would not stack up.

romaron, I don't know either, there are lot's of contradictions/incongruence between stated objectives and actions, but feels positive a specific position has been created which, one hopes, should champion UK energy producers of all types if they contribute appropriately to deliver energy security for the UK .Let's hear what what Grant Shapps has to say in his new position of Energy Security Secretary.
I've also been waiting for an announcement on the 33rd round of NS Licensing.

“It is also expected that the Department for Business, Energy and Industrial strategy will be broken up.
The prime minister promised last summer - when he was campaigning for the job - to re-establish a standalone Department for Energy.
It is thought Mr Sunak wants more focus on securing the UK's energy future, particularly after the recent price spikes.”
https://www.bbc.com/news/uk-politics-64548979

https://oilprice.com/Energy/Crude-Oil/Norways-Temporary-Tax-Breaks-To-Bolster-Oil-Flows-To-Europe.html

romaron, thanks the Nate Hagens interviewing Art Berman was well worth listening too. Some of the things explained here are why many of us bet on when investing in oil, especially that shale oil volumes from US would decrease and lose it's position as "swing producer", and that this (and other things) would cause POO increase/return to the mean. All the more annoying when the government's position is that poo has increased due to the war. The war did cause a spike, no doubt, but the increase in POO was coming anyway. We have relied for too long on cheap energy and now it's payback time. Good job 9x cheaper than oil renewables will save the day. Not.

Pelle, Stevo, Jan, on 8/11/22 IR wrote:
We have not provided specific guidance as it investors could then back in to potential profit estimates, and we do not give profit guidance. However, research analysts covering the company on average estimate c$100m per annum at $100/bbl oil price. This year, the amount would be less than this given the EPL only came in on May 26 (so effectively it is 7/12ths this year). We will make our first instalment for this year’s charge in December and a second instalment in January next year with a true-up in April 2023, which is also the first payment on account for the 2023 estimated tax charge I believe. As you note, there is potential for this to change given the news reports currently circulating. We, along with our peers, continue to reiterate the need for long-term thinking and fiscal stability to underpin the necessary investments in the energy industry.

Stevo, thanks for the reply. Seemed unlikely.

Stumpy, as with romaron, I've not seen any EU Floor price for oil with regard to their Windfall tax.. Neither have I seen anything about Shell, or anyone else, challenging the UK's EPL (Energy Profits Larceny). The weasels in the UK government have been "clever" to call this tax a "Profits Levy", not a windfall tax (see romaron's comments). Perhaps the conditions do exist for a legal challenge, I don't know.
Exxon have challenged the EU's windfall tax, based on the EU potentially having exceeded their authority (altho, if needed, each EU country could probably impose the tax without possibility of a challenge).
The EU tax is a windfall tax on profits and, rightly or wrongly, uses profit not oil price as the determining factor. "EU countries in September passed an emergency package of legislation aimed at tackling soaring energy prices. It included a temporary minimum 33 percent tax — dubbed a "solitary contribution" — on profits for fossil fuel and refinery companies that exceed a four-year historical average by 20 percent. The relevant profits could be from fiscal years 2022 or 2023, depending on the country." https://www.politico.eu/article/exxon-sues-european-council-over-eu-fossil-fuel-windfall-tax/

A UK Plc investing in a foreign subsidiary can use funds from pre-tax profit from UK operations, thereby reducing the profit amount subject to UK taxes (and…levies)?

The boss of Norwegian energy giant Equinor has said he does not expect gas and electricity bills to return to the levels they were before Covid.
Anders Opedal told the BBC the transition from fossil fuels towards less damaging sources of energy meant costs would remain high.
Mr Opedal also said that windfall taxes on energy firms were affecting investment in projects in the UK.
https://www.bbc.com/news/business-64270157

Mr Payne better hope the government's (and the opposition's) tax policy is modified if he wants to keep this jewel shining and have any chance of achieving those net-zero targets.
https://www.telegraph.co.uk/business/2022/12/20/ignore-critics-north-sea-still-britains-energy-crown-jewel/

https://www.investorschronicle.co.uk/news/2023/01/12/what-the-north-sea-bids-will-tell-investors-about-the-uk-s-energy-security/
I had missed that Labour have communicated they would increase the EPL to 38% and BACKDATE IT TO JANUARY 2022.
Absolute madness and a great way to further scare of investors.

You're right Jefferey1979. Whichever way you look at it the UK government is stealing the rewards here without taking any risk. Unacceptable and investors should react accordingly. The EPL investment incentive is a sort of Ponzi-scheme as even if an EPL oil floor price is revealed, eventually the UK government (of whichever party) will take the profits (no doubt inventing some self-serving BS and ****-taking reason to justify doing this). My expectation is that Enquest will take the approach of squeezing out of UK assets/investments the maximum with the minimum additional investment and diverting any major new investment to jurisdictions more favourable for investors. Decent returns still possible here for investors but not the rewards to justify having held in here thru good and bad times the last 5+ years. Have a nice day y-all :)