Two more international oil and gas producers with significant UK interests today announced big jumps in profitability.
Norway’s Equinor revealed that its adjusted earnings for 2022 had more than doubled to £62billion, while France's TotalEnergies saw adjusted net income double to £30billion.
They are the latest energy groups to report a very profitable year on the back of higher oil and gas prices, mainly due to Russia's invasion of Ukraine.
Anders Opedal, president and CEO of Equinor, said the company was uniquely positioned to provide energy and contribute to decarbonisation, while delivering strong returns.
He added: "Strong earnings and cash flow will enable continued competitive capital distribution and investments in high-value, resilient projects within oil and gas, renewables, and low-carbon solutions.
"In 2022, we responded to the energy crisis and contributed to energy security. With strong operational performance, we delivered record results and cash flow from operations.
Energy transition
"Our ambition is to be a leading company in the energy transition."
Equinor reported production of 2,046,000 barrels of oil equivalent per day for the fourth quarter of 2022, down from 2,158,000 boepd in the same quarter of 2021, impacted by turnarounds in the US offshore, the exit from Russian assets and deferral of gas production from the Norwegian continental shelf to periods with higher demand.
At the end of last year, Equinor said it was still working hard towards a final investment decision on the Rosebank oil field in the North Sea in the first quarter of this year, despite the latest windfall tax hike from the British Government.
The group said it was evaluating the impact of the energy profits levy on its projects, but said work was still progressing on the £4.5billion development proposed for west of Shetland.
Equinor is operator of Rosebank, which is estimated to be capable of producing 300million barrels of oil, making it one of the largest untapped reserves in UK waters.
Meanwhile, TotalEnergies said this morning that adjusted net income for the last quarter of 2022 was £6.28billion compared to £8.19billion in Q3.
Supply-constrained markets
CEO Patrick Pouyanne said: "While down from the previous quarter highs due to uncertainties about the demand outlook, fourth-quarter oil and gas prices as well as refining margins remained strong in supply-constrained markets."
He added that the company was benefiting from this favourable environment as well as an increase in its hydrocarbon production (+5%) and LNG sales (+22%).
The company's exploration and production unit had adjusted net operating income of £14.5billion last year thanks to higher oil and gas prices.
TotalEnergies said the impact of the UK's energy profits levy was £330million in Q$ and £830million for 2022.
At the start of December, TotalEnergies became the first major oil and gas operator to announce it was cutting spending as a direct result of the British Government's increased cash grab.
The head of the group's North Sea business said it would slash investment by a quarter this year - a £100million fall.
Producers targeted
UK Chancellor Jeremy Hunt targeted offshore producers in his November Budget, leading to fears that new projects in British waters could be delayed or even cancelled.
Pressure has since been mounting on him for a rethink on the severity of his tax plans.
He hiked the energy profits levy by another 10% to 35% - bringing the overall tax rate to an eye-watering 75%.
The chancellor has also extended the lifespan of the EPL until March 2028 from the previous date at the end of 2025.
The EPL is now expected to raise a total of £40billion - double the previous figure of £20billion. The total tax take from producers operators in British waters in the next six years is anticipated tol hit a staggering £80billion.