NORTH Sea heavyweight Neptune Energy has seen its UK profits increase by 150 per cent amid the surge in oil and gas prices which has left consumers facing sharp rises in their energy bills.

The private equity-backed company made $34.8 million operating profit in the UK in the first quarter compared with $13.9m in the same period last time.

The increase underlines the scale of the benefit that North Sea firms have enjoyed following the rise in oil and gas prices fuelled by the recovery from the pandemic and the fallout from the war in Ukraine.

Neptune said UK production remained stable in the first quarter.

The group quadrupled total operating profits, to $795m from $171m. It has production businesses in a range of European countries, including Norway, and in Africa and Asia.

The company is the latest in a series of North Sea firms to post dramatic increases in first quarter profits. These have left the Chancellor under increasing pressure to impose a windfall tax on firms to fund cuts in energy bills.

READ MORE: BP pledges to reinvest North Sea profits into Britain amid windafll tax calls

Oil firms have warned a windfall tax could deter them from investing in the North Sea at a time when the UK wants to increase domestic production to reduce its reliance on imports.

In the energy security strategy published in April Boris Johnson said the UK needed to give the energy fields of the North Sea a new lease of life.

Neptune said yesterday that it welcomed the publication of the strategy which “helps bring clarity to energy investors”.

On Tuesday Neptune said it plans to invest $1 billion (£0.8bn) over the next five years in the North Sea.

HeraldScotland: Neptune Energy executive chairman Sam Laidlaw Picture: NeptuneNeptune Energy executive chairman Sam Laidlaw Picture: Neptune

It held out the prospect that it could invest a further $1bn with partners in the development of the Isabella find east of Aberdeen if appraisal work goes well.

Neptune said yesterday that the backing for the industry from the government “provides encouragement for future significant investment in the large Isabella discovery”.

It expects to start drilling an appraisal well on Isabella in the second half.

The company is developing the Seagull find with BP.

It also has a big Norwegian North Sea business.

After achieving what it described as strong financial results in the first quarter, Neptune appears to expect market conditions to remain favourable.

“With commodity prices remaining at current levels we expect to continue to deliver a strong financial performance in the second quarter of 2022. This will be offset partially by high tax charges. For the full year, we now expect post-tax operating cash flow of around $2.0 billion,” said Neptune.

The forecast is in line with the one made in December when Neptune said it would pay $800m dividends to investors. Executive chairman Sam Laidlaw said the group had achieved “significantly higher operating cash flow in 2021 as a result of higher commodity prices, robust production and good cost control”.

Mr Laidlaw founded Neptune in 2015 after running giant utility Centrica and UK-focused Enterprise Oil. Mr Laidlaw won backing from international investors for a plan to capitalise on opportunities created following the oil price plunge that started in 2014.

Neptune said it got an average $97.2 per barrel for oil production in the first quarter, against $60.8/bbl in the same period of 2021. Its average realised gas price jumped to $25.7 per mmbtu (metric million British thermal unit) from $5.8/mmbtu The group said operating costs remained broadly flat at $11.6 per barrel oil equivalent. Brent crude sold for $107.37/bbl yesterday.