23rd Aug 2023 10:33
(Alliance News) - Ithaca Energy PLC on Wednesday said it has kept a lid on investments, as the North Sea oil and gas firm grapples with a UK windfall tax, as well as weaker prices.
Ithaca said investment across its "operated and non-operated portfolio has and will reduce" due to the energy profits levy. It means there will be a deferral and cancellation of some projects in 2023 and 2024.
This will impact its production outlook. Ithaca expects output in 2024 to be weaker than this year's.
"We are in the process of working through our medium-term outlook, incorporating the full impact of EPL at an asset level and updating subsurface models for the latest production history along with the potential positive effect of new opportunities we are currently reviewing and we will share an updated view of our medium-term production outlook later in the year," Ithaca said.
"The pace of investment across our pre-[final investment decision] projects has slowed as we continue to engage with the UK government to highlight the impact of the Energy Profits Levy and fiscal uncertainty on our ability to make critical decisions on large scale capital investments. We remain committed to developing our pre-FID projects and continue to engage in a constructive manner with the UK government."
For 2023, it affirmed its annual production guidance of between 68,000 to 74,000 barrels of oil equivalent per day. For the first-half of the year, production rose 14% to 75,755 barrels of oil equivalent per day, but revenue fell 6.7% to USD1.25 billion from USD1.34 billion due to lower commodity prices over the period.
It reported a sharp drop in interim profit, which fell to USD248.7 million from USD1.74 billion a year before.
Ithaca said it incurred energy profits levy charges of USD223 million in the period to June 30.
Shares in the company fell 1.9% to 160.77 pence each in London on Wednesday morning.
By Eric Cunha, Alliance News news editor
Comments and questions to [email protected]
Copyright 2023 Alliance News Ltd. All Rights Reserved.
Related Shares:
IAE.L