BP pledge to reinvest North Sea profits in Britain

BP chief executive Bernard Looney has said the oil giant will reinvest all the profits it makes in the North Sea into Britain as he opposed calls for the Government to impose a windfall tax on firms.

The Chancellor, Rishi Sunak, has faced intense pressure to impose a windfall tax after a series of firms posted big increases in profits following surges in oil and gas prices, which have left consumers facing steep increases in energy bills.

BP’S first quarter profits rose to a 14-year high of $6.2 billion (£5bn) from $2.63bn.

However, Mr Looney told the company’s general meeting: “People ask, what are we doing with the profits we make in the North Sea? The short answer is we’re reinvesting all of them. This decade – with our current plans – we expect to reinvest every £1 we make – and hopefully more.”

Mr Looney said the company expects to invest around £18 billion in Britain over the next decade with the spending to focus on improving energy security and accelerating the energy transition.

He added: “A stable and competitive fiscal environment is an important element in any investment decision. – and that is what we have in Britain today. By definition, windfall taxes are unpredictable – and so would challenge investment in homegrown energy.”

However, Mr Looney said the company’s plans were not contingent on whether or not there was a windfall tax.

Chancellor Rishi Sunak resisted calls for a windfall tax when he made his Spring Statement in March on the grounds such a levy might deter investment in the North Sea. He has signalled he will think again if oil and gas firms do not make the investment expected.

Oil and gas prices have risen sharply since early last year amid the recovery from the pandemic.and the fallout from the war in Ukraine. The cap on the annual energy bills of 22 million consumers rose by £693 from April, to £1,971.