Authored by Tsvetana Paraskova via OilPrice.com,
U.S. President-elect Donald Trump has called for opening up the UK North Sea to oil and gas and getting rid of windmills, in response to the recent announcement by Texas-based Apache that it would cease oil and gas production in the region due to the uneconomical windfall tax.
“The U.K. is making a very big mistake. Open up the North Sea. Get rid of Windmills!” President-elect Trump posted late on Thursday on social media platform Truth Social.
Trump attached an article about Apache’s recent announcement that it would exit the UK North Sea.
In November 2024, U.S. oil producer Apache said that it plans to cease oil production at its assets in the UK North Sea by 2030, due to the windfall tax on operators.
Apache’s parent company APA Corporation said in an SEC filing that its assessment of the impact of the windfall tax, officially known as the Energy Profits Levy (EPL), resulted in findings that continued production in the UK North Sea would be uneconomical.
The ruling Labour Party’s Autumn Statement confirmed that the windfall tax on UK North Sea operators is rising to 38% from 35%, effective November 1, 2024. The tax will now expire on 31 March 2030, a year later than the previous tax regime. The government is also removing the 29% investment allowance.
Since the tax was initially introduced by the Conservative government at the height of the energy crisis in 2022, oil and gas companies operating in the UK North Sea have been calling for certainty in the regulatory and tax framework. Recent changes in policies and the rising taxes have driven away operators, who say that a lack of North Sea investments would only make the UK more dependent on oil and gas imports.
U.S. President-elect Trump, for his part, has been a vocal critic of offshore wind. In the United States, offshore wind faces an uncertain future under Trump’s second-term administration. The President-elect has criticized offshore wind as the most expensive form of energy which, Trump says, also ruins the environment.