Harbour Energy, a British oil and gas producer, has confirmed that it will cut 350 jobs from its onshore operations in the UK due to the windfall tax that was imposed on the country’s oil and gas industry in 2022. Harbour Energy had announced earlier this year that it was reviewing its UK assets to align with the country’s lower future activity and investment levels. The company has now confirmed that it will reduce its UK workforce, while looking for ways to lessen the impact of the job cuts by introducing a voluntary redundancy scheme and freezing recruitment.
The company employs 1,700 people across its global operations, with 1,200 people working at its UK onshore facilities. The decision will not affect UK-based corporate and international roles, which the company is reviewing, as well as its offshore organisation. Harbour Energy released a statement in which it said that it had to reassess its future activity level in the UK due to the energy profits levy. The levy, which was increased by the UK Prime Minister in November 2022 from 25% to 35%, brings the total taxes on the sector to 75%.
In March, the company explained that the tax would “lead to a significant reduction in our UK workforce”. The tax is effective until March 2028 and applies to profits made from oil and gas extraction in the UK. Harbour Energy said that it was carrying out the review fairly and with consideration for everyone affected by the decision. The company has begun cutting jobs as it seeks to reduce its impact, but this is expected to take some time to be completed.
The energy industry in the UK has struggled in recent years due to the fluctuation in oil prices and the shift towards cleaner sources of energy. The industry has also faced increased pressure from climate activists who are pushing for more investment in renewable energy sources. The UK government has set a target of reaching net-zero carbon emissions by 2050, which has led to a reduction in oil and gas exploration and production.
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