Harbour Energy plc HBRIY is altering its portfolio to reduce exposure in the North Sea area owing to the increased taxes on oil and gas. According to reports, the company is set to go ahead with its plan by selling the stakes in Armada, Everest, Lomond, Catcher and Tolmount fields in the North Sea. This move comes ahead of the U.K.’s Labour government’s plans to hike taxes in the oil and gas sector, intending to use the proceeds to finance renewable energy projects.
HBRIY to Expand Beyond the North Sea
In December, HBRIY completed a major acquisition deal of Wintershall Dea’s assets located outside Russia that will help the company diversify outside the North Sea. The deal included the purchase of assets in Denmark, Egypt, Germany, Libya, Algeria, Argentina, Mexico and Norway along with the carbon dioxide capture and storage licenses. The $11.2 billion cash and stock deal almost doubled HBRIY’s production capacity, and the share price has gained more than 14% over the past 12 months.
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HBRIY’s US Listing Prospects
In order to advance its international growth strategy, HBRIY is considering a U.S. listing and shifting its headquarters. This strategy will not only improve its global presence but also balance the challenges faced due to new taxation policies in the U.K., and provide more opportunities in the investment-friendly market.
HBRIY’s Zacks Rank and Key Picks
The U.K.-based North Sea producer Harbour Energy is an independent oil and gas company currently holding a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like Smart Sand, Inc. SND, Nine Energy Service, Inc. NINE and Valaris Limited VAL.While Smart Sand currently sports a Zacks Rank #1 (Strong Buy), Nine Energy and Valaris each carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Smart Sand is a producer of northern white raw frac sand for the oil and gas industry. It offers proppant and related logistics services for oil and gas recovery from unconventional wells. SND’s expected EPS (earnings per share) growth rate for the next quarter is 125%, which compares favorably with the industry's growth rate of 17.41%.
Nine Energy Service provides onshore completion and production services for unconventional oil and gas resource development. NINE’s expected EPS (earnings per share) growth rate for the current quarter is 23.08%, which compares favorably with the industry's growth rate of 2.90%.
London-based Valaris Limited provides offshore-drilling services across all water depths and geographies. The Zacks Consensus Estimate for VAL's 2024 earnings indicates 290.18% year-over-year growth.
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