Shell to evaluate UK investments as windfall tax on oil producers increased – Auto Republish

MADRID (ICIS)–Shell is to evaluate plans to
spend up to £25bn in the next 10 years in the
UK after the government announced an increase
in a windfall tax on oil and gas producers, the
energy and petrochemicals major confirmed to
ICIS.

The head of Shell UK operations, David Bunch,
said on Monday the company is to “evaluate on a
case by case basis” its investments in the UK,
according to news agency Reuters.

A spokesperson for Shell, however, would not
clarify whether the re-evaluation of capital
expenditure (capex) plans in the UK could
affect the company’s petrochemicals operations.

Earlier in November, the UK’s Chancellor of the
Exchequer, Jeremy Hunt, announced the Energy
Profits Levy (EPL) on oil and gas companies
will increase from 25% to 35% from 1 January
2023 until the end of March 2028,
among other measures to increase its tax
collection.

“When you tax more, you’re going to have less
disposable income in your pocket, less to
invest,” said Shell’s Bunch to the
Confederation of British Industry (CBI)’s
annual conference on Monday.

“The comments by David Bunch … relate to future
projects and it’s too early to say which could
potentially be affected,” the spokesperson
said.

Shell’s chemicals operations in the UK include
its ethylene-producing facilities at
Mossmorran, Scotland, which is owned and
operated by ExxonMobil Chemical, from which
Shell takes 50% of the capacity.

Part of the ethylene is used at the Stanlow
facilities in the north of England, to produce
polymer, lubricant, and detergent
intermediates, plasticizers, and detergent
alcohols.

For alcohols, Shell’s Stanlow facilities have a
production capacity of 40,000 tonnes/year for
linear alcohol and 37,000 tonnes/year for
oxo-alcohols, according to the ICIS Supply and
Demand database.

The Stanlow plants are operated by Essar Oil on
Shell’s behalf as part of an integrated oil
refinery and petrochemicals site.

Additional reporting by Yashas
Mudumbai