The Norwegian state energy company Equinor has revealed privately in its industry contacts that it is reconsidering its plan for drilling for oil and gas in the North Sea, in the Rosebank field near the Shetland Islands, according to The Telegraph. Equinor said that before committing to the project, it wants the government to change the terms of its energy profit contribution – which was imposed to raise funds to help households with high gas and electricity bills in a cost-of-living crisis. partly fueled by the Russian invasion of Ukraine. Chancellor Rishi Sunak said about 5 5 billion would be raised through the additional 25 per cent one-off contribution to the “exceptional” profits made by energy companies since May 26 this year. It has been reported that the levy has caused friction in the cabinet. Understandably, Business Secretary Kwasi Kwarteng wrote to Mr Sunak last week to warn that the contribution – and the lack of industry consultation – risks losing investment in the North Sea project. Shortly after the announcement of the unexpected tax, a senior Equinor executive had warned that Rosebank’s work was in jeopardy, an industry source told the Telegraph. Equinor had also postponed its decision on the project until 2023, according to the newspaper. The source was quoted as saying: “The biggest issue now is the Rosebank project. Especially Rosebank is definitely available. Equinor has stated privately that it is under consideration, but has not made it public. “Rosebank is a big project, but for Equinor it honestly has bigger projects elsewhere. It would be very relaxed to say that we do not want to do this work. “ An Equinor spokesman said: “Equinor welcomes the decision of the North Sea Transition Authority to extend the license for the Rosebank development project. “We will continue to work with partners and stakeholders to ensure the progress and implementation of the Rosebank project to enhance the UK’s energy security.” Energy companies are pushing for unexpected tax changes through Offshore Energies UK. The agency wrote to Mr Sunak last week to request six urgent amendments, a “clear expiration date” for the levy and an urgent meeting with Downing Street. Shell, meanwhile, has told analysts separately that it is also less likely to develop the 2 2 billion Cambo project in the North Sea following the introduction of the unexpected tax. Earlier this month, Shell chief financial officer Sinead Gorman told RBC Capital Markets analysts that progress in the Cambo sector was less likely after the 25% surcharge.
