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The most scandalous part of our "special treatment" is the fact it is destined to be applied without further ado until 2028, without any consideration of inflation adjusted price of oil. By a pro-business-party by the way.
"This desperate attempt by financial players to keep their underwater positions from getting stopped out and sparking a cascade of margin calls has also translated into a ravenous shorting of energy stocks which as we pointed out a week ago, are the most shorted sector in Goldman's prime brokerage."
https://www.zerohedge.com/markets/oil-spreads-soar-physical-market-screams-tightness-while-hedge-fund-press-shorts
“Reaching Net Zero will require an estimated five-fold increase in current investment levels by 2030 – and around two-thirds of this will come from the private sector”
“This will only happen if investors have the confidence and the right environment to justify committing funding to the UK over the long term.” I am sure the Government will be happy to oblige by taxing the naughty oilers to death.
https://www.energyvoice.com/renewables-energy-transition/wind/uk-wind/548631/report-finds-nearly-two-thirds-of-uk-energy-firms-consider-moving-investments-abroad/
“Now is the time where we need to seek that investment, unlock that £200 billion and see that real value in terms of jobs, in terms of economic value up and down the country.”
New regulator, new strategy
OEUK is also calling for a new “independent statutory body” to be created, with powers and resource to oversee UK energy and net zero objectives.
Mr Whitehouse said: “What we’re talking about is an evolution of what we have in the UK. We have some great institutions.
“The Committee on Climate Change I think provides a is a valuable resource, but it’s focused purely on our climate goals. The Office of Budget Responsibility has a role to play in terms of understanding the value in our economy.
“What we’re calling for is a body that gives long term overview, sets out that long term path, but actually looks across the entire energy trilemma.
“So we’re looking not just at our climate goals, which are clearly important, but also ensuring that in doing that we deliver on good quality jobs, real value in our economies and real value in our communities.”
Mr Whitehouse said the North Sea Transition Authority (NSTA) is “there for the discussion” in that space.
Other items include a joined-up industrial strategy, inclusive of investment in grid infrastructure for offshore wind power.
That includes ensuring policies to ensure the energy transition takes place “with people, not to them” as regards onshore grid infrastructure. Mr Whitehouse said: “. I think there hasn’t been enough of a discussion in the UK about what is really going to be required.”
Election showdown in Aberdeen?
Last week at First Minister’s questions, Humza Yousaf challenged Scottish Labour leader Anas Sarwar to a debate in Aberdeen on oil and gas.
While Labour has come under fire for its taxation policies, the SNP has been accused of hypocrisy over its “presumption against” further North Sea exploration.
The Tories, meanwhile, are the party which introduced the windfall tax and plan to keep it in place for four more years, despite windfall conditions since falling away.
Asked if OEUK would participate in such a debate, Mr Whitehouse said: “I think it is essential OEUK would be involved in that conversation.
“I think it’s essential that the 400 members that we have actually, not just here in Aberdeen but up and down the country, are part of that conversation.
“And what I would say is our manifesto, is the path to a successful energy transition. I think it’s a really valuable contribution which shows how we unlock that investment, how do we build the skills that are required to make the best of it for the UK and Scotland.”
The OEUK manifesto
Among its manifesto – split between themes of skills, security and sustainability – are asks around commercial models for developing CCUS, hydrogen and offshore wind, as well as measures for ports, regulation and industrial strategy.
The asks include creation of a new regulatory body with oversight “across the entire energy trilemma”.
OEUK’s policy statement sets out that “the UK can become a leading green industrial power” but do so “companies must see the UK as an attractive country to invest in”.
It adds that “parliaments may thrive on opposition and argument, particularly in election year, big engineering projects only succeed through collaboration”.
“The transition to net zero will be the biggest engineering project this country has ever seen. It will fail if we undermine the industries, workforces, and communities whose skills will be vital for building our energy future.”
Windfall tax
It sets out a call to end the windfall tax before 2028, when it is currently expected to sunset.
The policy, brought in under the conservative government in 2022, has seen 90% of operators cut spending, with some cutting jobs.
Labour has gone so far as to say it would remove investment allowances, which OEUK said would see up to 42,000 jobs lost, and investment bank Stifel said a “best case scenario” is 20,000 jobs gone.
Mr Whitehouse said that the industry saw “unprecedented commodity prices” in the wake of the invasion of Ukraine and it was right for sectors to play their part.
“But as windfall conditions go, that windfall tax must go. And when you look at commodity prices today, they’re back in line with where they were pre-Ukraine.
“So we’re calling for the windfall tax to go. And we think that’s right. That means we can encourage investment into the sector, support our jobs, support our skills, support our important supply chain.”
Mr Whitehouse highlighted that profits are made internationally, “they’re not being made here in the North Sea”.
Asked whether Big Oil and international oil firms should make their North Sea profits transparent, he said: “I think I think transparency is good. I think it helps with the with explaining the north-east position where it’s clear what value is being made here in the in the North Sea. I think it helps for that case that now is the time where we need to unlock investment in the North Sea.
‘Choices will be felt for decades to come’: OEUK launches general election manifesto
Trade body warns that energy transition "will fail" if industry is undermined by policy.
Trade body Offshore Energies UK (OEUK) has warned the energy transition “will fail” if the industry is undermined by policy, as it launches its general election manifesto today.
The group said its policy statement maps out a pathway for £200bn of investment in the UK sector this decade, something which has been cast in by doubt by signals from political parties across the Westminster benches.
OEUK said decisions made in the next parliament will be “felt for decades to come”.
It comes days after Labour leader, and likely the next prime minister, Sir Keir Starmer said he would extend and hike the windfall tax on the North Sea, which industry and analysts said would see tens of thousands of jobs lost due to Labour’s threat to remove investment allowances.
OEUK CEO David Whitehouse said he was “deeply saddened by the announcement”, but the sector “will engage with all political parties to make the case” for unlocking investment.
Last week Scottish First Minister Humza Yousaf challenged Scottish Labour Leader Anas Sarwar to a debate in Aberdeen running up to the election.
Speaking to Energy Voice, Mr Whitehouse said it is “essential OEUK would be involved in that conversation” as the manifesto asks politicians to choose a “homegrown energy transition”.
I hope the other article spoilt it less. Time to fight back! https://www.energyvoice.com/oilandgas/north-sea/548574/wind-ccs-projects-risk-being-delayed-or-shelved-altogether-by-labour-windfall-tax-plan/
@Schlemiel : Romaron was hinting at the good performance of ENQ's bonds. The bond market is the cleverer one and assumes ENQ will not have a problem paying back the interest and the principal of the bonds....
But i don't know in how far that will "unleash" the equity price....
Hi Romaron, this is the article as it appeared in the Telegraph : https://www.telegraph.co.uk/business/2024/02/22/china-weaponised-net-zero-aimed-at-vulnerable-west/
"We are determined to ensure lower energy bills, good, skilled jobs, energy security and a fair and just transition for all who have invested so much in our energy industries."
I am sure AB will be jumping for joy!
The sarcasm : "Of course, dialogue with oil and gas workers and businesses matters, which is why Keir Starmer, Anas Sarwar and I visited Aberdeen last November and we will continue to engage. In response to the sector’s concerns, for example, Rachel Reeves has made clear that North Sea operators should only pay windfall rates of tax while prices are historically high."
Https://www.ft.com/content/5fb5991e-e430-4832-9d1b-5b577aa4ee59
Some people must be very very desperate to post the POFCY-value as a title on this board. I repeat it : the US-ticker has no value, none whatsoever, for the London listed PFC-shares as there is no liquidity on the US Market. Volume for the +10.5%-movement is 15 000 shares. Good luck with that if you base your investment decisions on that!