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The Guardian
12 hours ago
- Business
- The Guardian
Reeves promised oil industry ‘quid pro quo' over windfall tax in private meeting
The chancellor, Rachel Reeves, told a fossil fuel company the industry would receive a 'quid pro quo' in return for higher taxes on its windfall profits, it can be revealed. In a meeting with the Norwegian state energy company Equinor on 27 August, Reeves suggested that the government's carbon capture, usage and storage (CCUS) subsidies were a payoff for oil firms being hit with a higher tax rate. Minutes of the meeting obtained by DeSmog and seen by the Guardian state that Equinor's CEO, Anders Opedal, raised concerns over the energy profits levy – also known as the 'windfall tax' – and 'its impact on the value' of Equinor's UK portfolio. In response, Reeves said that raising the windfall tax from 35% to 38% was a 'manifesto commitment', but stated that 'Equinor should recognise the quid pro quo – the funds raised enable government investment in CCUS etc'. CCUS is the controversial practice of trapping the emissions produced by fossil fuel plants before they enter the atmosphere. Many scientific experts have suggested the technology is not economically viable. It is accused of being a favourite climate 'solution' of the fossil fuel industry since it allows for the continued extraction of oil and gas. The Labour government announced in October it would provide £22bn in subsidies to CCUS projects over 25 years after an increase in lobbying by the fossil fuel industry. The Green party co-leader, Carla Denyer, said Reeves and the Labour government had been 'caught out making promises in a secret exchange deal which goes against the interests of the British people'. The MP for Bristol Central added: 'In public, they claim to be taxing fossil fuel giants more fairly by raising the windfall tax, but behind closed doors they are giving back with dodgy deals to allow the fossil fuel corporates to continue with business as usual under the guise of CCUS – an expensive distraction and largely unproven technology.' Equinor is one of the main companies investing in the UK's CCUS sector. In December, the government signed deals with Equinor, BP and TotalEnergies to develop carbon capture facilities in Teesside. This will involve the development of the Net Zero Teesside power plant, which will be 25% owned by Equinor and aims to be the world's first gas-fired power station featuring CCUS. Earlier this year, Equinor was forced to retract a claim that it stores 1m tonnes of carbon dioxide annually at its flagship carbon capture project in the North Sea. Equinor has not captured 1m tonnes of CO2 per year at the site since 2001, and only captured a 10th of that figure in 2023. Equinor made a $28.7bn (£21.2bn) post-tax profit in 2022 after Russia's invasion of Ukraine triggered higher oil and gas prices – a figure that stood at $8.8bn in 2024. Tessa Khan, the executive director of the campaign group Uplift, said: 'Oil companies like Equinor have held sway over successive UK governments, for years shaping policies to benefit their bottom line and slowing down climate action. This Labour government must stand up to them and put our needs – for affordable clean energy and a safe climate that we can pass on to our children – ahead of their insatiable need to profit.' The House of Commons' public accounts committee, which scrutinises government spending decisions, released a report in February describing the UK's £22bn CCUS subsidies as 'risky'. The report noted that the government has downgraded its ambitions for CCUS storage, scrapping its previous commitment of storing 20 to 30m tonnes annually by 2030. It also highlighted that the UK's new CCUS projects do not allow the government to share any potential profits, or for local consumers to benefit from lower energy bills. The committee also reported that producing liquid natural gas, which will be used in the UK's CCUS projects, leaks more greenhouse gases into the atmosphere than previously thought. 'This could undermine the rationale for pursuing certain schemes,' the report said. After being sued by the environmental consultant Andrew Boswell over the Net Zero Teesside scheme, the previous Conservative government admitted it had not taken into account the plant's full potential emissions, which Boswell estimated could reach more than 20.3m tonnes of carbon dioxide equivalent during its lifetime. In summer 2024, a judge rejected Boswell's case, which argued that officials did not fully explore the environmental impacts of the scheme before approving it. The government also won the appeal in May. Sign up to First Edition Our morning email breaks down the key stories of the day, telling you what's happening and why it matters after newsletter promotion Boswell, who leads the Scrap Carbon Capture campaign, called Reeves's Equinor meeting 'an outrageous spectacle'. He said: 'She begs Norway's oil colossus to tax its huge profits, and then gifts it with far more in return – many billions over decades for climate-wrecking CCUS.' Equinor and Shell have formed a joint venture to become the UK's largest North Sea fossil fuel producer. In November, the government admitted it had unlawfully approved the development of the UK's largest untapped oilfield, Rosebank, which is operated by Equinor, by not taking into account the climate effects of the combustion of oil and gas to be extracted from the field. Equinor intends to reapply for approval to develop the field. The Labour government has been steadfast in its support for the UK achieving net zero emissions by 2050, with Keir Starmer having said 'homegrown clean energy' is 'in the DNA' of his administration. The Climate Change Committee stated in its 2025 appraisal of the government's net zero policies that the UK needs to scale up its CCUS capacity to 73m tonnes-a-year by 2050 to help meet its climate commitments. 'Investment in carbon capture and storage is a gamble on unproven technology,' said Lily-Rose Ellis, a campaigner at Greenpeace UK. 'All it does is give oil and gas giants carte blanche to continue causing planet-destroying emissions in the hopes that one day they might be able to capture the carbon and store it for all of eternity. Public money should be spent on renewables, which guarantee to lower emissions, bring bills down and boost the economy with new jobs.' A spokesperson for Equinor said: 'Equinor has been a reliable energy partner to the UK for over 40 years, providing a stable supply of oil and gas, developing the UK's offshore wind industry, and pioneering solutions to decarbonise the UK economy, including carbon capture and storage. 'Using our experience of decarbonising energy production in Norway, including safely storing carbon emissions under the North Sea for over 25 years, we are supporting the UK to develop its own homegrown energy transition.' A government spokesperson said: 'We are delivering first-of-a-kind carbon capture projects in the UK, supporting thousands of jobs across the country, reigniting industrial heartlands and tackling the climate crisis. Money raised from changes to the energy profits levy made at autumn budget last year support the transition to clean energy, enhance energy security and independence, provide sustainable jobs for the future, and help protect electricity bills against future price shocks.'
Irish Independent
10-06-2025
- Business
- Irish Independent
Slew of Irish windfarms put up for sale by Denmark's Orsted
The entire 800MW platform, which also includes windfarms in the UK, Germany and Spain, could fetch as much as €2bn. Orsted's European onshore headquarters are based in Cork city, where it employs about 100 people. The group has invested €800m in Ireland across a portfolio of wind and solar projects. Of the 27 operational onshore windfarms that are up for sale by Orsted, 21 are in Ireland. They include windfarms across the country, stretching from Donegal to Kerry. The company is currently building a 50MW windfarm in Co Tipperary and has six projects in development. The planned sale of Orsted's onshore wind assets was first reported by industry publication PeakLoad. Orsted declined to comment. PeakLoad noted that BNP Paribas is advising on the proposed sale of the assets, dubbed Project Grace. Non-binding offers are slated to be submitted next month. The entire portfolio includes more than 600MW of power from windfarms, with up to 371MW being generated by the operational Irish units. The sale will also include windfarm sites under development. The Danish energy company also has a windfarm in Co Antrim that produces electricity for Amazon under a power-purchase agreement. In Ireland, Orsted also has a 50-50 joint venture with semi-state forestry company Coillte. The Coom Green Energy Park in Co Cork has an installed capacity of 105MW and is expected to be in commercial operation next year. Last December, Orsted and FuturEnergy Ireland – a joint venture between the ESB and Coillte, secured planning permission for the Ballinagree Wind Farm, which will be located between Millstreet and Macroom in Co Cork. With 16 turbines, it is expected to generate up to 112MW of electricity when it becomes operational around 2030. Last summer, Orsted started construction on its first Irish solar farm, an 81MW facility outside Carlow town. Last month it started construction on its second, a 55MW project in Co Cork. The company has a pipeline of 700MW of solar-farm projects in Ireland. Orsted has also partnered with the ESB to jointly develop offshore wind energy projects. Ireland is aiming to generate 80pc of its energy needs from renewable sources by 2030. Headquartered in Denmark, Orsted employs more than 8,000 people. The company is listed on the Nasdaq in New York, with a market capitalisation of $115bn (€100bn). Last year, Norway's Equinor bought an almost 10pc stake in Orsted, in what was a major move for the two companies. It made Equinor the second-largest shareholder in Orsted after the Danish state, which has a controlling interest in the firm. 'Equinor has a long-term perspective and will be a supportive owner in Orsted,' Equinor chief executive Anders Opedal said at the time. 'This is a counter-cyclical investment in a leading developer, and a premium portfolio of operating offshore wind assets,' he added. 'The exposure to producing assets complements Equinor's operated offshore wind portfolio of large projects under development.'
Yahoo
07-06-2025
- Business
- Yahoo
Equinor signs $27bn natural gas supply deal with Centrica
Equinor has signed a significant contract with Centrica to supply the UK with natural gas over the next decade, valued at approximately £20bn ($27.11bn). The deal secures the supply of 55 terawatt-hours (TWh) of natural gas per year, equivalent to around five billion cubic metres (bcm), for a ten-year period, beginning on 1 October 2025. The contract terms are based on prevailing market prices. This agreement builds on a long-standing supply relationship between Equinor and the UK, which began in 2005. Equinor president and CEO Anders Opedal said: 'I am very pleased to strengthen the energy partnership with the UK and our long-standing partner and customer Centrica. This agreement will continue to support the UK's energy security with reliable gas supplies from the Norwegian Continental Shelf. 'The flexibility that natural gas offers will play a key role in enabling further development of renewable power and decarbonisation in the UK.' Under the new contract, the annual gas volumes will account for nearly 10% of the UK's total gas demand. As of 2024, the UK imported 66.2% of its gas requirements, with 50.2% of those imports sourced from Norway. This represents an increase from 2022, when around one-third of UK gas imports came from Norway. The contract includes provisions that allow for a potential shift from natural gas to hydrogen in the future, aligning with efforts to develop the UK's hydrogen sector. Equinor's UK country manager, Alex Grant, added: 'The UK and the North Sea is a core area in our long-term ambitions to remain a supplier of reliable energy and to help decarbonise societies and industries. 'The new gas sales agreement with Centrica will be a key element in this. Energy security and decarbonisation must go hand in hand, and I am proud that Equinor is actively delivering both.' In March, Equinor began production at the Halten East field in the Norwegian Sea. The project is operated by Equinor Energy (69.5%) alongside partners Vår Energi (24.6%) and Petoro (5.9%). "Equinor signs $27bn natural gas supply deal with Centrica" was originally created and published by Offshore Technology, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Yahoo
07-06-2025
- Business
- Yahoo
Equinor and Centrica Ink $27 Billion Natural Gas Supply Deal for U.K.
Equinor ASA (NYSE:EQNR) has signed a new long-term deal with U.K. energy company Centrica, worth roughly £20 billion ($27.1 billion), to supply natural gas to the U.K. over the next decade. Starting October 1, the agreement is based on current market prices and will provide about 10% of the country's annual gas needs. Despite efforts to cut back on fossil fuels, around 70% of U.K. homes still rely on gas for heating, and gas power plants contribute roughly 25% of the nation's electricity. Under the agreement, Equinor ASA (NYSE:EQNR) will deliver about 5 billion cubic meters of gas per year, compared to the U.K.'s 2024 total demand of 55.8 billion cubic meters. Equinor ASA (NYSE:EQNR) Chief Executive Anders Opedal made the following statement: 'This agreement will continue to support the U.K.'s energy security with reliable gas supplies from the Norwegian continental shelf.' This deal replaces an earlier 10-year contract between the two companies that began in 2015 and ends in 2025. Last year, the U.K. imported nearly two-thirds of its gas supply, with Norway accounting for half of those imports, especially after Russian gas exports to Europe dropped following the 2022 invasion of Ukraine. EQNR has surged by over 4% in the past month. While we acknowledge the potential of EQNR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: and Disclosure. None. Sign in to access your portfolio
Yahoo
06-06-2025
- Business
- Yahoo
Equinor and Centrica Ink $27 Billion Natural Gas Supply Deal for U.K.
Equinor ASA (NYSE:EQNR) has signed a new long-term deal with U.K. energy company Centrica, worth roughly £20 billion ($27.1 billion), to supply natural gas to the U.K. over the next decade. Starting October 1, the agreement is based on current market prices and will provide about 10% of the country's annual gas needs. Despite efforts to cut back on fossil fuels, around 70% of U.K. homes still rely on gas for heating, and gas power plants contribute roughly 25% of the nation's electricity. Under the agreement, Equinor ASA (NYSE:EQNR) will deliver about 5 billion cubic meters of gas per year, compared to the U.K.'s 2024 total demand of 55.8 billion cubic meters. Equinor ASA (NYSE:EQNR) Chief Executive Anders Opedal made the following statement: 'This agreement will continue to support the U.K.'s energy security with reliable gas supplies from the Norwegian continental shelf.' This deal replaces an earlier 10-year contract between the two companies that began in 2015 and ends in 2025. Last year, the U.K. imported nearly two-thirds of its gas supply, with Norway accounting for half of those imports, especially after Russian gas exports to Europe dropped following the 2022 invasion of Ukraine. EQNR has surged by over 4% in the past month. While we acknowledge the potential of EQNR as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: and Disclosure. None. Sign in to access your portfolio
