NEO Power Group Ltd. has determined to “decelerate” oil and fuel funding in the UK as a result of dangers from the federal government’s deliberate coverage and taxation modifications.
Aberdeen-based NEO has 25 operated and non-operated places on the UK aspect of the North Sea, 23 of that are producing, in keeping with data on its web site. The corporate, owned by European vitality investor HitecVision Advisory AS, is awaiting environmental clearance for one mission off the coast of Aberdeenshire and assessing the potential of reentering one other mission that ceased manufacturing Could 2016.
Reform plans for the trade just lately introduced by the Labor administration “have materially elevated the extent of uncertainty in relation to the UK’s oil and fuel sector and funding choices on this context are extraordinarily difficult”, NEO stated in a press release on its web site.
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Final week the Division for Power Safety and Web Zero (DESNZ) stated it is going to provide you with new environmental steering for oil and fuel companies as regulators have been required by a current Supreme Courtroom ruling to contemplate Scope III emissions in Environmental Affect Assessments (EIA) for brand spanking new initiatives.
The federal government of Prime Minister Keir Starmer determined to not enchantment the choice on the Finch case, during which the Supreme Courtroom nullified the Surrey County Council’s planning permission for the Horse Hill oil growth as a result of end-use planet-warming emissions had not been factored in.
The DESNZ will interact the trade, commerce unions, employees and civil society for the brand new steering. “The federal government is performing swiftly in order that choices on oil and fuel growth consents will be made”, it stated in a press release August 29.
Anticipating that the session wouldn’t conclude till spring 2025, the Offshore Petroleum Regulator for Setting and Decommissioning (OPRED) stated it was pausing environmental assessments, together with ongoing ones.
In any other case, operators can be “losing money and time submitting environmental statements that don’t comprise the required components”, the OPRED stated in a separate assertion August 29.
On July 29 the federal government confirmed it plans to boost the Power Earnings Levy to 38 %, prolong its effectivity to March 2030 and tighten the levy’s funding allowances.
“Towards this unsure backdrop, NEO and its 100% proprietor HitecVision, have taken the choice to materially decelerate funding actions throughout all growth property in its portfolio”, NEO stated.
Nevertheless, it has determined to hunt a license extension for the Buchan Horst oil redevelopment mission “as a way to proceed technical analysis in gentle of those modifications to tax and environmental consents”.
As an alternative of 2027, the anticipated begin of manufacturing might be pushed again, NEO stated. It operates the North Sea mission with a 50 % stake, with Serica Power PLC and Jersey Oil & Fuel PLC holding 30 % and 20 % respectively.
The coverage and taxation modifications “clearly have a unfavourable impression on the economics and general viability of a mission such because the Buchan Horst”, NEO stated.
To contact the writer, e mail jov.onsat@rigzone.com
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