Oil and gas firms are being framed as the “devil incarnate” as general election rhetoric ramps up, a top North Sea dealmaker has complained.
Andrew Austin said is firm Kistos Holdings (AIM: KIST) is one of several which has pulled out of deals due to political uncertainty and that the windfall tax is being seen as a “victimless” crime as the UK gears up for an election.
Speaking to The Herald, he said: “Part of the problem is both parties are rightly trying to chase the 18 to 24 year old vote and in their minds climate change and oil and gas companies are the devil incarnate, therefore taxing them is effectively a victimless crime; that’s what’s driving it on both sides of the house.”
Investment ‘off the table’
Mr Austin, who built up his former company RockRose Energy into a £250m business, said committing fresh capital to projects in the North Sea “is definitely off the table” until there’s certainty as to “the Government and the Government’s position”.
There have been four changes to the windfall tax since 2022 under the ruling Conservative government, while Labour, which is leading the polls, has promised a “proper windfall tax” should it win power.
Last month, the CEO of Hartshead Energy told Energy Voice the uncertainty on Labour’s plans have led to it cutting project team jobs.
Meanwhile the party’s pledge – which includes cutting investment allowances while hiking and extending the levy – has led to warnings it will kill off North Sea investment.
Kistos’ partner in the West of Shetland, TotalEnergies, told Energy Voice last year that the uncertainty is impacting potential Final Investment Decisions for their projects in the region.
Mr Austin told The Herald that the windfall tax is not making Shell or BP the victim.
“The victims are the small independents who effectively have become the mantle-holders for the North Sea as the majors and super-majors have exited.
“You’ve seen it with Harbour, with Ithaca with Serica and us. These are the guys that are getting hurt.”
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