Harbour Energy records drop in revenue and production as windfall tax weighs
Harbour's chief executive said the tax all but "wiped out" the firm's profits in 2022
North Sea oil and gas producer Harbour Energy has reported a drop in revenue for 2023 as the price of oil fell from its peaks recorded in 2022.
The London-listed firm said in its full-year results today that revenue fell 31 per cent from $5.4bn (£4.2bn) to $3.7bn (£2.9bn), while net debt ticked down to $200m (£157m) from $800m (£628m) the year prior.
Harbour’s profit before tax fell 75 per cent to $597m (£468.5m). It posted a post-tax profit of $32m (£25.1m), up from $8m (£6.2m) in 2022.
The acquisition of Wintershall Dea’s upstream oil and gas assets for $11.2bn (£8.7bn) announced in December, is set to be completed in the fourth quarter of this year and will be funded through porting of existing investment grade bonds from Wintershall Dea, Harbour equity and cash.
The board declared a final dividend payout totalling $100m (£78.4m) in respect of the 2023 financial year to be paid in May 2024, equating to 13 cents (10p) per share.
The amount of oil Harbour extracted fell year-on-year from 208,000 barrels of oil equivalent per day (kboepd) to 186kboepd while operating costs per barrel rose by $2(£1.5) to $16 (£12.5).
Looking ahead, Harbour said it expected to be “marginally” cash flow positive for 2024, supported by a boosted capital investment programme.
“Harbour improved our safety performance, generated material free cash flow, and progressed our international growth opportunities and CCS projects while maintaining our capital discipline,” said Linda Z Cook.
“We are excited about our future as we look to continue to build a geographically diverse, large scale, independent oil and gas company focused on safe and responsible operations, value creation and shareholder returns.”
It’s been a difficult week for the North Sea oil and gas industry. Yesterday Chancellor Jeremy Hunt announced that the nearly 75 per cent windfall tax on profits from those in the sector would remain at current levels and be extended for an additional year.
Harbour’s chief executive Linda Z Cook has previously said that the tax essentially “wiped out” the firm’s gains from the energy crisis of 2022.
