NEPTUNE Energy has forecast a “material” rise in production this year as new projects are ramped up in the North Sea.
But it warned the introduction of windfall taxes has “created significant fiscal and political uncertainty” in the UK, Germany and the Netherlands and may undermine investment in Europe.
Neptune, which operates the North Sea’s giant Cygnus gas field, is guiding on production of 150,000 to 165,000 barrels of oil equivalent per day for 2023, as it ramps up activity on the Njord area and starts work on the Fenja and Seagull projects. It produced 135,000 boepd in 2022.
Neptune underlined the benefit of the rise in commodity prices following Russia’s invasion of Ukraine last year as net cash flows from operating activities increased to $2.4 billion from $1.7bn. Profit before tax climbed to $3.1bn from $1.4bn, with earnings after tax rising to $924.4m from $387.2m.
Sam Laidlaw, executive chairman of Neptune Energy, said: “The last 12 months have seen a dramatic shift in the geopolitical environment that shapes how energy is produced and used. After Russia’s war in Europe it is inevitable that there is a generational redrawing of political and economic allegiances.
“Against a backdrop of underinvestment, lower commodity prices of the last decade have been replaced by surging prices and marked volatility. This is particularly the case with natural gas, due not only to the war, but also increased awareness of its importance in the energy transition. Having invested more than $7 billion to transform Neptune over the past five years, we are well positioned for these changes, with a portfolio that now has greater production capacity, more lower carbon development opportunities and a stronger balance sheet.”
Neptune chief executive Pete Jones said: “The imposition of windfall taxes in 2022 has created significant fiscal and political uncertainty in the Netherlands, Germany and, in particular, the UK, undermining investment in these countries and longer-term energy security in Europe.”
"We continue to progress our new energy strategy and are prioritising electrification and CCS, which will help us achieve our ambitious 2030 climate targets.”
