Home News North Sea vitality teams pay bumper dividends as costs soar

North Sea vitality teams pay bumper dividends as costs soar

North Sea vitality teams pay bumper dividends as costs soar

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One of many North Sea’s largest fuel producers Neptune Vitality has paid $1bn in dividends to its house owners, prompting renewed requires a windfall tax on the sector.

Personal-equity backed Neptune Vitality, which gives about 12 per cent of the UK’s fuel, stated a rise in manufacturing and better commodity costs had elevated working money move to $2bn within the yr to December 31 2021, up from $880mn in 2020. This enabled it to pay out a complete of $1bn in dividends this yr, up from $800mn introduced in December.

Harbour Vitality, the most important oil and fuel producer within the North Sea, additionally reported buoyant earnings on Thursday, and confirmed a $200mn payout to shareholders.

The corporate, which is listed on the FTSE 250, stated it might generate as much as $1.7bn in spare money this yr, paving the way in which for extra acquisitions and bigger dividends if costs common $100 a barrel of oil and 200p per therm of fuel. It has requested shareholders to permit it to purchase again 15 per cent of its shares and says it might repay its debt this yr.

Oil costs surged to greater than $130 a barrel after Russia’s invasion of Ukraine, however have since fallen again to only over $100, whereas the worth of fuel hit 227p a therm final week as fears of shortages of supplies grew.

The bumper dividends prompted renewed requires a windfall tax on North Sea oil and fuel producers to assist households and energy-intensive industries address increased gasoline payments.

In April, common family vitality payments will rise to nearly £2,000, a rise of just about £700 a yr, pushed primarily by excessive fuel costs.

Ed Miliband, the Labour social gathering’s shadow local weather change secretary, stated the “figures are but extra proof of hovering earnings within the oil and fuel sector as households are hit by huge rises in vitality payments”. 

“When firms are spending large sums on share buybacks and producers themselves are saying they’ve additional cash than we all know what to do with, the case for motion is obvious.”

Labour is looking for a one-off windfall tax to present households £600 off their vitality payments.

Harbour Vitality reported internet earnings of $101mn in 2021, in contrast with a $778mn loss in 2020 when costs slumped due to decreased demand throughout the pandemic. Though it had internet debt of $2.3bn on the finish of final yr, it stated it had the potential to be debt free in 2023.

Its complete oil and fuel output was the equal of 175,000 barrels of oil a day in 2021, largely from the UK, and that is anticipated to develop to common greater than 200,000 b/d this yr.

Neptune is predicated within the UK however operates in seven international locations together with the Netherlands, Egypt, Indonesia and Algeria. It was based in 2015 by Sam Laidlaw, a former Centrica chief govt, with backing from non-public fairness corporations Carlyle and CVC and sovereign wealth fund China Funding Company, which has the biggest stake at 49 per cent.

The corporate stated demand for fuel and oil surged final yr, with costs it acquired per barrel rising from $46 to $66 within the calendar yr. 

Manufacturing rose from 144,000 barrels of oil equal a day in 2020 to 148,000 a day in 2021 because it introduced ahead three new fuel initiatives in Norway and Indonesia.

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