Boris’ headache as Norway threatens to abandon £4.5bn North Sea oilfield over windfall tax | City & Business | Finance


The funds gathered from the windfall would be used to pay off some of the spiralling energy bills faced by British households. The $100bn Norwegian state energy company Equinor, which is behind a major oil project, has threatened to abandon investment in the North Sea. The move, if followed through on, would be the strongest backlash yet against Boris Johnson’s new windfall tax.

Equinor told industry contacts it is reconsidering its plan to drill for oil and gas in the Rosebank field near the Shetland Islands.

An industry source spoke to the Daily Telegraph and said a senior Equinor executive warned the Rosebank project was now at risk.

Sources speaking to the Daily Telegraph said Equinor wants the Government to change the terms of its so-called Energy Profits Levy.

The source said that only after the Government does this will they commit to the investment.

Equinor has also warned trade body representatives about its fears for the project.

Now, other energy companies have complained that the Government’s windfall tax.

They say it will push multinational companies to invest in jurisdictions with a more stable fiscal policy.

The source that spoke to the Daily Telegraph said: “The biggest one up for debate now is the Rosebank project.

“Rosebank in particular is definitely up for grabs.

“Equinor has privately said that it’s under review.

“But they’ve not done so publicly.

“Rosebank is a big project, but for Equinor frankly it has bigger projects elsewhere.

“It would be pretty relaxed about saying we don’t want to do that project.”

Shell has separately told analysts it is also less likely to develop the £2bn Cambo project in the North Sea after the introduction of an additional 25 percent tax on energy company profits.

Rishi Sunak has imposed an extra levy to raise around £5bn to fund support for British households struggling with increases in energy bills in the cost-of-living crisis.

The Chancellor has said it is right for the Government to tax the “extraordinary” profits energy companies have earned from rising prices.

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