Harbour Energy Soars After Kicking Off Buyback, Raising Targets

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(Bloomberg) — Harbour Energy Plc, the UK’s biggest independent oil and gas producer, jumped the most since 2023 in London trading after announcing the start of a $100 million share buyback and raising financial targets.

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The company reported strong first-half earnings on Thursday, more than tripling free cash flow as it incorporated assets acquired from Wintershall Dea last year. That allowed it to raise its full-year cash forecast by about 10% to $1 billion and announce the fresh buyback.

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“We strengthened our financial position” despite market volatility, Chief Executive Officer Linda Cook told reporters. Harbour “entered the second half in an excellent position.”

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The shares climbed as much as 21% and traded up 13% as of 10:24 a.m. London time.

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Recent months have seen wild oil-market swings, with prices buffeted by US President Donald Trump’s trade war, shifting OPEC+ policy and Israel’s attacks on Iran. Yet Harbour’s integration of Wintershall Dea fields, including in Norway, Germany and Argentina, allowed it to triple daily production to 488,000 barrels of oil equivalent and raise the lower end of its full-year output guidance.

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The new buyback will take total shareholder distributions to $555 million in 2025, assuming it completes by year’s end, Harbour said in a statement, adding that it has to conclude by March 31. The company declared an interim dividend of $227.5 million, or 13.19 cents a share, in line with its annual payout policy.

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Harbour trades in London and operates fields in the UK North Sea. Yet it’s among many companies working on the British continental shelf to reassess their activities after several tax increases. In May it announced plans to cut jobs, and on Thursday said it expects to complete the reorganization by the end of this quarter.

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“So long as the fiscal regime is as it is in the country, investment here just finds itself hard to compete with the opportunities we have in other countries,” Cook said on a call. “Our investment levels and therefore production is going to continue to decline over time” in the UK.

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North Sea producers have seen several increases and extensions of the Energy Profit Levy, a windfall tax introduced in 2022. Earlier this year, government officials held talks with the industry to discuss various mechanisms that could replace the tax, which expires in March 2030. 

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Harbour doesn’t expect any outcome from those consultations “until, probably, the fourth quarter, possibly as part of the UK autumn budget,” Cook said.

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