LONDON, United Kingdom – British finance minister Jeremy Hunt on Thursday, November 17, unveiled plans to increase a windfall tax on oil and gas companies and extend it to power generation firms in an effort to raise tens of billions of pounds to plug a major hole in public finances.Russia’s invasion of Ukraine
The windfall tax will be expanded to electricity generators with a levy of 45% being applied from January 1 to revenues the government deems “extraordinary,” from low carbon power generators such as wind and nuclear. Shares in Centrica, which owns oil and gas production assets, 20% of Britain’s nuclear fleet, and Britain’s largest energy supplier British Gas, rose 5.4%.
Jefferies analysts, however, said that the extension of the tax’s timeframe to 2028 from the end of 2025 was shorter than initially expected. Ithaca has previously warned that a further windfall tax risks making field developments in the aging basin “uneconomical.”