(Reuters) – US President-elect Donald Trump on Friday called for “opening up” the North Sea and getting rid of windmills in a post on his social media platform Truth Social.
Oil companies have been steadily exiting the North Sea in recent decades, with production falling from a peak of 4.4 million barrels of oil equivalent per day at the beginning of the millennium to about 1.3 million barrels of oil equivalent today.
Trump's post was in response to a report about plans by Apache, the Apache unit of US oil and gas producer APA Corp, to exit the North Sea by the end of 2029. The company expects North Sea production to decline by 20% year-on-year in 2025.
In October last year, the British government said it would increase the windfall tax on North Sea oil and gas producers to 38% from 35%, and extend the tax for one year. The government wants to use oil and gas revenues to raise money for renewable energy projects.
Britain aims to largely decarbonize its energy sector by 2030, which means reducing its reliance on gas-fired power stations and rapidly increasing its ability to generate renewable energy.
North Sea producers have warned that the higher tax rate could lead to a sharp decline in investment and emerge from the aging pool before new tax increases.
Reuters previously reported that Harbor Energy, Britain's largest North Sea producer, wants to sell stakes in North Sea oil fields and is renewing listing plans in the United States. US oil major Exxon (NYSE:) completed its exit from the North Sea region in July last year.
The North Sea has seen significant development of wind farms by Britain and European countries, but the fast-growing offshore wind sector has faced a difficult few years with costs ballooning due to technical and supply chain issues as well as rising interest rates, prompting many companies to review investments.
Companies are reconsidering their investments in offshore wind, or have assumed declines, due to the high cost of developing wind farms that can be more than 100 kilometers (62 miles) offshore.
Orsted (CSE:), the world's largest developer of offshore wind farms, trimmed its investment and capacity targets last year.
