Election spells end of North Sea as Labour policies doom oil industry

The looming early election threatens the end of the North Sea oil industry, according to experts, with Labour’s threat to extend the Government’s windfall levy set to hasten the sector’s decline. Analysts said a likely victory for Sir Keir Starmer would prompt operators to give up on British waters, meaning some of Britain’s biggest oil and gas reserves may never be recovered. “If Labour deliver on their promises, the UK continental shelf is finished,” said Ashley Kelty, research director at Panmure Gordon, a leading investment bank. The future of the North Sea oil industry was thrown into doubt in 2022 when the Government imposed a windfall levy on the profits from oil and gas production that took total tax to an eye-watering 75pc. Labour has pledged to add another 3pc, along with banning new drilling and, perhaps most damaging of all, stripping offshore companies of the tax breaks they get when investing in new fields. The plans were confirmed by shadow chancellor Rachel Reeves at a meeting last week. Many operators are already moving investments overseas, including Serica Energy, one of the top 10 UK producing oil and gas companies. It operates 11 fields producing the equivalent of 46,000 barrels...

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