As BP Leaves the North Sea, These Independents Are Buying In
- Oil majors are retreating from the UK North Sea, as declining production and a 78% tax rate drive companies to divest or diversify abroad.
- Harbour Energy and EnQuest are expanding internationally, targeting growth in Argentina, Mexico, and Southeast Asia while reducing UK exposure.
- Ithaca Energy faces a crucial decision on the Rosebank oilfield, with regulatory uncertainty threatening future UK investment despite record production and strong dividends.
Back in July, UK oil and gas major BP Plc. (NYSE:BP) announced that it was putting its entire UK North Sea oil and gas business up for sale as part of a broader $20-billion portfolio overhaul, marking the end of a 60-year era as a leading player in Europe's largest oil basin. BP's North Sea operations produced about 117,000 barrels of oil equivalent per day in 2025 (roughly 5% of BP's total global output) and employed around 1,100 people. BP is hardly alone. Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) have sold their UK North Sea assets in recent years, while Shell Plc. (NYSE:SHEL) and TotalEnergies (NYSE:TTE) have folded theirs into joint ventures as the basin depletes. North Sea production has dropped sharply over the past couple of decades, from ~4.5 million boepd at the turn of the millennium to roughly 1 million boepd currently.
Frequent policy shifts and regulatory uncertainty from the UK government have also played a big role in pushing the energy giants out. The UK North Sea tax regime imposes a headline rate of 78% on upstream oil and gas profits, made up of a 38% Energy Profits Levy (EPL), 30% Ring Fence Corporation Tax and a 10% Supplementary Charge. Investors are now closely tracking the planned switch from the EPL to the Oil and Gas Revenue Levy (OGRL).
Instead of taxing profits, the OGRL will charge 35% on the portion of upstream revenues above set price thresholds of $90 per barrel for oil and 90p per therm for gas, or about $12 per million British thermal units (Btu).
Below those levels, producers would pay only the 40% base rate (30% ring-fence corporation tax plus the 10% supplementary charge). The OGRL is due to replace the EPL when it expires in March 2030, and Offshore Energies UK is lobbying for it to start in January 2027 instead.
Here are 3 North Sea energy stocks to watch as the new tax regime unfolds.
#1. Harbour Energy Plc
Market Cap: $7.1B
52-Week Returns: 48.0%
London-listed Harbour Energy (OTCPK:PMOIF) is one of the largest players in the UK North Sea, and it has spent the past two years cutting its dependence on the basin. In 2024, Harbour completed its $11.2-billion acquisition of Wintershall Dea's upstream portfolio, excluding Russia. The deal brought in assets in Norway, Germany, Denmark, Argentina, Mexico, Egypt, Libya and Algeria, plus European carbon capture licenses, and it more than doubled Harbour's output.
Harbour produced a record 509,000 boe/d in the first half of 2026 and raised its full-year production guidance to 490,000-500,000 boe/d. Higher oil prices lifted its 2026 free cash flow forecast to about $1.8 billion, from $1.4 billion. Management has committed at least $800 million to shareholders this year, including a new $250 million buyback running to March 2027 and an interim dividend of 8.05 cents a share. Net debt stood at $5.17 billion at the end of June, or 0.7 times leverage.
Harbour's growth pipeline sits outside the UK. The company holds 15% of the SESA LNG project in Argentina, which is on track to start up by the end of 2027. It aims to have the Zama and Kan discoveries in Mexico ready for investment decisions on the same timeline.
#2. EnQuest Plc
Market Cap: $776.4M
52-Week Returns: 183.5%
EnQuest (OTCPK:ENQUF) built its business by buying mature fields the majors no longer wanted and extending their lives. Its UK assets include Magnus, Kraken and the Greater Kittiwake Area, along with stakes in the Ninian Pipeline System and the Sullom Voe Terminal in Shetland.
The company is now going big in Southeast Asia. In June, EnQuest agreed to buy interests in four offshore Malaysian production-sharing contracts from Petronas Carigali and E&P Malaysia Venture for up to $833 million, with about $554 million due at closing.
Those assets produced about 57,400 boe/d in 2025, more than EnQuest's entire current output.
On a 2025 pro forma basis, the deal raises group production to about 100,000 boe/d, lifts proved and probable reserves by about 85% to roughly 300 million boe, and cuts unit production costs by about 35% to $16/boe. Completion is expected on December 31.
EnQuest's first-half production rose 8.6% to 41,544 boe/d, helped by new fields in Vietnam and Malaysia, and the company tightened its 2026 guidance to 41,000–43,000 boe/d. Net debt was $517 million at the end of June, about 1 times EBITDA.
#3. Ithaca Energy Plc
Market Cap: $6.6B
52-Week Returns: 42.5%
Ithaca Energy (OTCMKTS:ITHLF) became one of the largest producers in the UK North Sea through its 2024 combination with the UK assets of Eni S.p.A (NYSE:E). Second-quarter output hit a record 131,000 boe/d, 48% of it gas, and the company reaffirmed 2026 guidance of 120,000–130,000 boe/d. Ithaca raised its 2026 dividend forecast to $500–530 million, and leverage stood at 0.49 times at the end of June.
Ithaca holds 20% of Rosebank, a $3.8 billion field west of Shetland. The remaining 80% belongs to Adura, the Equinor–Shell joint venture. A court quashed the project's original consent for failing to account for emissions from burning the oil. The UK energy minister said this month that a Rosebank decision "will take a little longer." Ithaca chair Yaniv Friedman told the Financial Times the company will likely halt further investment in Britain if the government does not approve the project, putting the stock's next leg on the outcome of the pending legal challenges and government approval.
Ithaca is already investing outside the UK. In early October, it agreed to buy Suncor's offshore Newfoundland stakes for $860 million upfront, plus up to $250 million in Brent-linked payments. The package includes 48% of Terra Nova and interests in White Rose and the West White Rose Extension. The assets hold 103 million boe of proved and probable reserves, and Ithaca expects them to average about 30,000 boe/d from 2027 to 2031. The deal is due to close in the first half of 2027.
