Harbour Energy to exit some non-UK projects; shares slip on tepid results

By Shanima A and Pushkala Aripaka

(Reuters) -Harbour Energy plans to exit some projects in Mexico and South America to focus on developing its British portfolio, the North Sea’s biggest oil and gas producer said on Thursday as it posted a profit in its first set of results as a listed company.

Harbour is withdrawing from the Sea Lion project in the Falkland Islands, interests in Brazil’s Ceara Basin and in the Burgos Basin in Mexico to reinvest in lower-risk opportunities in regions where the company already has a presence, it said.

Struggling with heavy debt after the oil price crash of 2017 and tepid profits during COVID-19 lockdowns, Premier Oil struck a deal with Chrysaor last year to bolster its North Sea resources and began trading as Harbour Energy in April.

The North Sea is a region in the Atlantic Ocean which is home to the Brent crude stream that underpins global oil prices.

Chief Executive Linda Cook declined to comment on reports in recent weeks that rival Neptune Energy, which is also focused on the North Sea area, was considering a merger with Harbour.

“We won’t comment on any specific market speculation, but I will say, with everything going on in the sector today, there are a lot of opportunities for a company like ours,” Cook told journalists.

“We might have a lot of conversations with different parties, and are continually looking at a wide range of options,” she added.

While investors have been keen on Harbour’s plans around M&A, investors were not pleased with the company’s lukewarm financial results.

Harbour shares were more than 5% lower at 361.6 pence by 0851 GMT and were the biggest loser on London’s midcap index.

Pre-tax profit came in at $120 million for the six months ended June 30 on revenue and other income of $1.50 billion, which Peel Hunt analysts said was “more or less in line” with their expectations for the full year.

They also pointed to uncertainties around the timeline for first gas from Harbour’s Tolmount platform.

(Reporting by Shanima A and Pushkala Aripaka in Bengaluru; Editing by Sherry Jacob-Phillips and Jan Harvey)