Harbor Energy may turn to North Sea over tax fears

The UK’s biggest oil and gas producer wants to reduce its exposure to the North Sea and move its stock market listing to the US, fearing a Labor tax raid.

In a major blow to the industry, London-listed Harbor Energy is reportedly considering selling its stakes in its North Sea oil fields.

The move comes after Energy Secretary Ed Miliband announced plans to increase taxes on profits of oil and gas companies from 75 to 78 percent, which would make the duty one of the highest raised in the world.

The windfall taxes were originally introduced in response to soaring energy prices following Russia’s invasion of Ukraine and will now be extended until the end of the decade.

Seeing a new setback for the oil and gas sector, the government is preparing to remove tax incentives for investment and block new exploration licenses.

Dealing a blow to the industry, London-listed Harbor Energy is reportedly considering selling its stakes in its North Sea oil fields.

Chancellor Rachel Reeves is expected to announce the crackdown as well as a series of tax rises in her first Budget next week. The budget is expected to include cuts to pensions, inheritance taxes and capital gains, as well as an increase in fuel taxes.

Business leaders warn double whammy of tax rises and £5bn cost of new workers’ rights regulations will hit the economy and cost jobs.

Industry group Offshore Energy UK said the attack on the North Sea would put thousands of jobs at risk and deal a £13 billion blow to the UK economy.

In response, Harbor revived plans to move its stock market listing to the United States, dealing a major blow to the City, according to the Reuters news agency.

According to reports, the company is planning to acquire a US-listed company, which will allow it to list in New York and move its headquarters to the United States.

Harbor suspended its search for a US business last year when it decided to buy the non-Russian portfolio of German rival Wintershall Dea for £8.5 billion.

The deal, finalized last month, allowed Harbor to diversify outside the North Sea and more than double its production.

The company has also initiated a process to sell its interests in the Armada, Everest, Lomond, Catcher and Tolmount fields in a bid to reduce its exposure to the North Sea, the report said.

A spokesperson said: “We are a London-listed company and as long as our geographic center of gravity is in Europe it wouldn’t really make sense to move the listing.”

It is not the only company to warn of Miliband’s plans.

Ithaca Energy said in August that Labor’s tax plan would cause “long-term damage” to the sector.

A month earlier, Ineos Energy said it would prioritize expansion in the United States and Denmark because British policies were “hurting” the oil and gas industry.