UK’s oil and gas producer Harbour Energy has reportedly confirmed plans to axe 350 jobs at its onshore operations in the UK, due to the windfall tax imposed on the country’s oil and gas sector in 2022.
In January this year, Harbour said it started reviewing its UK assets to align with the country’s lower future activity and investment levels.
The company, which employs 1,700 people across its global operations, has now confirmed it would cut jobs at its UK onshore where it employs 1,200 people.
However, Harbour said that it is looking ways to reduce the impact of its job cuts decision by launching a voluntary redundancy scheme and freezing recruitment.
BBC News cited the firm as saying in a statement: “When we announced the review, we said that as a result of the energy profits levy, which results in an effective tax rate of 75% in the UK regardless of the level of oil and gas prices in the market or realised, we have had to reassess our future activity level in the UK.
“At our full year results in March, we explained this would ‘lead to a significant reduction in our UK workforce’.”
The decision will not impact UK-based corporate and international roles, which the firm is reviewing, and offshore organisation.
“We are very conscious of the impact of this news on our people, and we are carrying out the review fairly and with consideration for everyone who is affected,” the company said.
In November 2022, UK Prime Minister Rishi Sunak increased the Energy Profits Levy (EPL) on oil and gas companies from 25% to 35%, thus bringing the total taxes to 75% on the sector.
Effective until March 2028, the tax applies to profits made from oil and gas extraction in the UK.