The UK windfall tax on North Sea oil and gas operators has made economics in the basin impossible for companies to invest, according to Brian Gilvary, the chairman of Ineos Energy. “In our initial strategy we wanted to expand in the UK, particularly gas. And what has happened is that the tax regime makes that impossible,” Gilvary told the Financial Times, commenting on the prospects of the oil and gas arm that UK-based chemicals group Ineos created four years ago.
“The economics don’t stack up when you have the alternative to move that money to the Gulf of Mexico,” Gilvary told FT. Ineos Energy has just announced a deal to buy the U.S. Gulf of Mexico business held by China’s CNOOC. This was the third major recent investment by Ineos in U.S. oil and gas, following an LNG supply deal with Sempra Energy in 2022 and the acquisition of Chesapeake Energy’s oil and gas assets in South Texas a year later.