Offshore Energies UK, the sector’s trade body, urges policymakers to reform the Energy Profits Levy (EPL) now to back British firms and jobs, as Sir Jim Ratcliffe’s Ineos Energy confirms it has ceased all investment in Britain, citing 'one of the most unstable fiscal regimes in the world.'
The call for immediate action comes in the fiftieth anniversary year of the iconic Forties Pipeline System and as OEUK’s Economic Report 2025 highlights the UK is now importing over 40 per cent of its energy, and as Apache, Chevron and leading firms also withdraw investment from the UK and focus on investing in jobs and projects in other countries.
David Whitehouse, CEO of Offshore Energies UK comments:
'There is no time to lose – jobs are being lost today. The offer from industry is clear – reform to this tax now to protect UK jobs, investment and the economy. The North Sea has been the powerhouse of the UK’s industrial success and prosperity and with the right fiscal and economic policies it can be the platform for an era of economic success.
'Politicians have the power and the responsibility to make this happen. OEUK’s recent report showed the profoundly negative impact of the current Energy Profits Levy on the UK economy and our sector. It will struggle to make 40 per cent of the tax revenues originally projected as it’s choking investment, but if changes are put in place by 2026 and announced in this budget this sector could contribute an additional £137 billion to the value of the economy by 2050.
'As many as 1,000 UK oil and gas jobs a month are being lost— this would be unacceptable in any other sector. This trend is set to continue until at least 2030. At the same time we are seeing record-breaking energy imports, which are more carbon intensive and subtract jobs and value from the economy. Our message is simple – act now and work with industry to safeguard jobs and unlock the growth the whole economy needs.
'What happens to the North Sea does not stay in the North Sea. It ripples across sectors through Aberdeen, Grangemouth, Humberside, Teesside, Tyneside, East Anglia, the Northwest. It undermines our manufacture of fuels, chemicals, pharmaceuticals. We risk an industrial contagion.'?
OEUK’s proposed reforms to the EPL would:
- Add £137bn to the economy by 2050
- Secure £41 billion of extra investment in UK energy by 2050
- Support 23,000 additional jobs by 2030
- Unlock £12 billion in additional tax receipts by 2050
Ineos will now focus its future investment in the United States, diverting £3 billion away from the UK following the closure of its Grangemouth refinery in Scotland and the loss of 430 jobs.
Quoted in the Telegraph today, Executive Chairman Brian Gilvary stated: 'We have stopped investing in Britain. Our future investment will not be in the UK. There’s no question of that. The problem is that the UK has become one of the most unstable fiscal regimes in the world from a perspective of natural resources and energy. It means we cannot invest with any certainty because we can’t be sure what future tax rates will be.'
This announcement adds to a growing list of concerns from across the energy sector as it awaits the outcomes of critical government consultations, including on the proposed abolition of new oil and gas licences in UK waters. This comes as other countries such as Norway continue licensing in the North Sea alongside the roll out of renewables and are leaping ahead.
The decision by Ineos is underlined as leading energy figures warn of the consequences of current policy. Greg Jackson, CEO of Octopus Energy, has called for a pragmatic approach, stating:
'Homegrown fossil fuels should continue to play a key part in the UK’s energy mix. When we’re shipping LNG around the world, it is a lot dirtier than using locally produced gas. If we’re going to produce gas then I’ve got no problem in using local stuff.'
Jackson has also warned that Britain’s broken energy system is driving up bills, and that prioritising domestic energy production is essential for both environmental and economic reasons.
US operator Apache (APA Corporation) has announced it will withdraw from the North Sea by 2029, explicitly blaming the 'onerous financial impact of the EPL' and new regulatory requirements for making continued production uneconomic.
Chevron is also preparing to exit the North Sea after more than 55 years, joining a trend of global operators retreating from the UK basin amid fiscal uncertainty and declining competitiveness.
Source: OEUK
