BritEnergy expands into US Permian basin amid UK energy policy concerns

BritEnergy Group has acquired a majority stake in thirteen wells within the Permian basin in New Mexico, marking the latest departure of a UK oil and gas firm from the domestic market. The Lincolnshire-based company cited a hostile regulatory environment in Britain as a primary driver for its international expansion. This move follows similar announcements by Hunting and BP, both of which have indicated plans to reduce or exit their North Sea operations due to perceived investment barriers.

Garry Mahoney, the chair of BritEnergy Group, described the United Kingdom as increasingly unfriendly to fossil fuel investment. He argued that the country is moving toward energy zero at a pace that exceeds the stated net zero targets. Mahoney noted that while Britain retains advantages in engineering and capital access, the current climate is discouraging committed investors. He contrasted this with the United States and Morocco, which he described as open for business with coherent energy policies that are not distorted by unsustainable subsidies.

The company’s criticism centres on the Energy Profits Levy, a tax on oil and gas profits that was raised to 38 per cent under the Labour government’s first autumn budget. The levy is scheduled to sunset and be replaced in April 2030. The Scottish Conservatives recently urged energy secretary Miatta Fahnbulleh to scrap the tax, citing a list of companies making job cuts, leaving the North Sea, or collapsing entirely. Mahoney labelled the UK’s net zero strategy quixotic, claiming it offers neither affordable nor secure energy.

BritEnergy has invested 50 million dollars to acquire five producing wells, including two new horizontal wells. The company targets five million barrels of production by 2032 and anticipates 200 million dollars in profit. Additionally, it plans to construct a 300 megawatt solar farm in Lea County and is in talks for a gas production deal in Morocco. The firm noted that major technology companies are building datacentres for artificial intelligence in New Mexico and Texas, states that supply a significant portion of US natural gas and electricity.

The acquisition was audited by Deloitte, with Brodies providing legal advice and Maples Group serving as corporate adviser. A spokesperson confirmed that BritEnergy has not fully exited the UK market and will continue its Lincolnshire operations. The company recently lodged a tier three complaint with the Health and Safety Executive regarding the conduct of an inspector, alleging bad behaviour and threats to shut down operations unfairly.