Harbour Energy defends extra investor payout after 12-fold rise in profits
The North Sea’s biggest oil and gas producer has become the latest big energy company to report huge earnings on the back of rising wholesale prices, with half-year profits rising 12-fold to $1.5bn (£1.3bn).
Harbour Energy said it would hand an extra $200m to shareholders on the back of the bumper revenues, which were boosted by the jump in fossil fuel prices following Russia’s invasion of Ukraine, as well as extra income linked with its merger with Premier Oil.
Its surging earnings and investor payouts will add to the debate in the UK about whether to increase the windfall tax on oil and gas producers, following outrage at the world’s five biggest oil companies’ eyewatering profits of nearly £50bn between April and June.
Meanwhile, households in Britain await the announcement on Friday of a new domestic energy price cap; it is forecast to increase to nearly £3,600 a year from October, while rising gas and electricity bills are forcing businesses across the UK to fold.
Harbour said it was now preparing to pay another $100m in dividends to shareholders by October, and increase its share buyback programme from $200m to $300m.
The 12-fold rise in profits was linked to the fact pre-tax profits in the same period last year were weaker, at $120m, amid lower demand during the Covid pandemic.
Linda Cook, chief executive, said: “We delivered a strong first-half performance, realising value from past acquisitions, increased production efficiency and significant investment in our asset base.”
Wholesale energy prices, which were already at highs a year ago as the demand surged following the easing of pandemic restrictions, have been pushed even higher since Russia invaded Ukraine amid restrictions on oil imports and Vladimir Putin’s moves
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