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Slide rules will be red-hot after today's budget, lets see where SQZ go from here, private or not is the question !

aimo & dyor

2.59: One of the government’s key missions is to make the UK a clean energy superpower. To achieve that, it is essential that oil and gas companies contribute more to the energy transition: this is why the government is making changes to the Energy Profits Levy (EPL) including increasing its rate by three percentage points to 38%, removing the 29% investment allowance, and extending the time the levy applies until 31 March 2030.

2.60: The government is committed to managing the energy transition in a way that supports jobs in existing and future industries and so will retain the availability of 100% first year capital allowances within the EPL. As announced in July, the decarbonisation allowance will also remain in order to incentivise the sector to invest in cleaner, lower-emission technologies and will be set at 66% to maintain its cash value.

2.61: After a period of change, the government also recognises the importance of providing the oil and gas industry with long-term certainty on taxation. The government will publish a consultation in early 2025 on how the taxation of offshore oil and gas will respond to price shocks once EPL ends in 2030. In addition, the government is today publishing a consultation on new environmental guidance for assessing end use emissions related to oil and gas projects. This consultation seeks to provide stability for the oil and gas industry, support investment, protect jobs and ensure a fair, orderly and prosperous transition in the North Sea in line with our climate and legal obligations.

2.59: One of the government’s key missions is to make the UK a clean energy superpower. To achieve that, it is essential that oil and gas companies contribute more to the energy transition: this is why the government is making changes to the

Energy Profits Levy (EPL) including increasing its rate by three percentage points to 38%, removing the 29% investment allowance, and extending the time the levy applies until 31 March 2030.

2.60: The government is committed to managing the energy transition in a way that supports jobs in existing and future industries and so will retain the availability of 100% first year capital allowances within the EPL. As announced in July, the decarbonisation allowance will also remain in order to incentivise the sector to invest in cleaner, lower-emission technologies and will be set at 66% to maintain its cash value.

2.61: After a period of change, the government also recognises the importance of providing the oil and gas industry with long-term certainty on taxation. The government will publish a consultation in early 2025 on how the taxation of

offshore oil and gas will respond to price shocks once EPL ends in 2030. In addition, the government is today publishing a consultation on new environmental guidance for assessing end use emissions related to oil and gas projects. This consultation seeks to provide stability for the oil and gas industry, support investment, protect jobs and ensure a fair, orderly and prosperous transition in the North Sea in line with our climate and legal obligations.

2.59: One of the government’s key missions is to make the UK a clean energy superpower. To achieve that, it is essential that oil and gas companies contribute more to the energy transition: this is why the government is making changes to the

Energy Profits Levy (EPL) including increasing its rate by three percentage points to 38%, removing the 29% investment allowance, and extending the time the levy applies until 31 March 2030.

2.60: The government is committed to managing the energy transition in a way that supports jobs in existing and future industries and so will retain the availability of 100% first year capital allowances within the EPL. As announced in July, the decarbonisation allowance will also remain in order to incentivise the sector to invest in cleaner, lower-emission technologies and will be set at 66% to maintain its cash value.

2.61: After a period of change, the government also recognises the importance of providing the oil and gas industry with long-term certainty on taxation. The government will publish a consultation in early 2025 on how the taxation of

offshore oil and gas will respond to price shocks once EPL ends in 2030. In addition, the government is today publishing a consultation on new environmental guidance for assessing end use emissions related to oil and gas projects. This consultation seeks to provide stability for the oil and gas industry, support investment, protect jobs and ensure a fair, orderly and prosperous transition in the North Sea in line with our climate and legal obligations.

Shorter's ( working in packs ) have ABRDN by the danglies, after climbing +5p todays, in a matter of a few hours on the run into close, we ended the day down 0.1p !

Not sure a 78% tax on ALL PROFITS, is something that can be cheered !

Interesting the broker thinks it's worth including Buchan in our ~£2.90 per shares value equation, lets see if tomorrow allows it to be so !

I have a weird feeling that SQZ strategic approach to acquisitions could be closer to home than most would like. We now have a plethora of companies looking to exit NS, most likely at close to fire-sale deals, esp after tomorrow. SQZ have cash and $1bn loan facility to draw upon and yet we have still not made an overseas acquisition, why ! SQZ have always stated if opportunity presents itself in the NS then they would look closely at it.

We have high profile players looking to exit HBR/BP/CVX (Exxon recently left) but also smaller ones too, such as Japex with ~£150 of tax losses. I'm more convinced that we will be making deals in the NS, mentioned it before, SP is irrelevant unless you are thinking of selling, high dividend yields is another way to play the game and extract value.

aimo & dyor

Last week HBR announced they are to dispose of major NS assets, coupled with a listing / move to US exchange. We also have BP's new CEO Murray Auchincloss’s now stating "plan to prioritize near-term returns from the firm’s more profitable fossil fuel operations...". In other words shut-down / dispose / run-down of NS assets too, combined with what could be move of HQ to US and become its main listing. Not only will NS tax revenue fall but so will the tax take from the City too.

UK's most profitable businesses will soon be the £1 shops, or as it will be in 10 years time with inflation, the £10 shop !!

Thought for the day :

How long before these green alternatives to hydrocarbons start to produce 'extraordinary profits' ?

aimo & dyor

We have seen it many times before, massive volumes with delayed reporting at opening SP.

Date Time Trade Prc Volume Buy/Sell Bid Ask Value

24-Oct-24 13:34:53 269.10 886,834 Unknown* 274.80 275.40 2m O

24-Oct-24 13:34:52 269.10 886,834 Unknown* 274.80 275.40 2m O

Share shuffle ...

"There is very little scope to manipulate share prices either by companies themselves or by traders given the level of market surveillance these days" ..... Really !!!

..... in other words, T/O is the way forward.

aimo & dyor

Panmure, "The opportunity in the shares turns on the sum-of-the-parts which, even with the state of performance, suggest a value nearer 240p with a management team now more likely to see that realised"

GB Energy will be bankrolled by the 'National Wealth Fund (NWF)' created earlier this month by renaming the 'UK Infrastructure Bank' introduced by Conservatives. They make no profit with the Bank’s overall financial capacity of £22bn, £12bn of which is debt and £10bn of HMG guarantees. Basically the 'NWF' will throw our cash at green projects obtained from UK tax payers with little to no come back.

As for HBR cast-offs, should we pick them up for next to nothing, at the most, and run them dry I'm sure there is something in it for us, all depends on decom and debt etc involved. My guess is HBR will just want rid of them asap at whatever cost, esp if HBR intention is to list in US, they don't want to be associated with the Banana Republic that is the UK hanging around their neck in their IPO.

There is no way SQZ will exit our NS assets as we have left it far too late so why not add more, sentiment is and will be extremely poor for next 6 years so why worry about the SP and just continue paying ~20% dividend PA whilst pumping the wells dry for min expenditure. Just a thought !

aimo & dyor

Got some this morning, nice gap on opening too.

"Won't the labour government just block the move of a re list? "For energy security purposes..."

Not sure that is even possible, if they are some how prevented from doing so then I'm sure Linda would have no issue mothballing our assets if they are not making any money. After all Ineos have already stated that their major Forties pipeline may shut down as early as 2030 if plans to extend the windfall tax suffocates investment. Not just investment but production too will dictate the early closure, Labour, say goodbye to your tax raid and impossible net zero dream and of course being kicked out of office as energy bills skyrocket due to lack of domestic supply.

What a mess the UK are in !

aimo & dyor

Morning Mommur,

"lets hope they don't tax divi payments at 78% !.."

I've got a feeling that divi's will be taxed more, probably inline with income / CGT tax and zero allowance too, maybe not this budget but for sure within the next two.

SQZ have been a disappointment in terms of getting ahead of the game (unlike HBR), just not sure why that is, yet !

aimo & dyor

"Top British North Sea producer Harbour Energy (HBR.L), wants to sell stakes in North Sea oilfields and is reviving plans for a U.S. listing, sources said, as more firms scale back investments ahead of new tax increases on the sector.

The government is also preparing new environmental guidance, opens new tab for oil and gas projects, which executives said could further impede investments in the ageing basin...

Harbour has also launched a sale process of its stakes in the Armada, Everest, Lomond, Catcher and Tolmount fields as it seeks to reduce its exposure in the North Sea, the sources said.

Britain's Labour government said it would increase the windfall to 38% from 35% starting Nov. 1, bringing the headline tax rate on oil and gas activities to 78%, among the highest in the world. Its duration will also be extended by a year to March 2030.

The changes will also include scrapping the levy's 29% investment allowance, which lets companies offset tax from capital that is re-invested.

"The UK (North Sea) is currently un-investible. Absent a sensible fiscal regime that encourages continued investments and provide some stability, it will continue to be un-investible," Serica Energy Chairman David Latin told Reuters..."

https://www.reuters.com/business/energy/harbour-energy-joins-north-sea-producers-retreat-ahead-tax-hikes-2024-10-23/

Wonder who the buyer is ....probably us, lol !!!