Essay by Eric Worrall
h/t Strativarius – Thousands of jobs at risk “… have applied to the High Court of England and Wales to appoint administrators. …”
North Sea oil giant falls into administration with thousands of jobs at risk after energy tax row
By Patrick O’Donnell
Published: 27/10/2025 – 07:58
Updated: 27/10/2025 – 08:30A major North Sea oil and energy giant has filed for administrators in a move placing thousands of jobs at risk amid ongoing scrutiny over windfall taxes imposed on the sector.
…
In a statement, a spokesperson for Petrfoac shared: “Having carefully assessed its options, and the impact of TenneT’s decision… the directors of Petrofac Limited have applied to the High Court of England and Wales to appoint administrators.
“When appointed, administrators will work alongside executive management to preserve value, operational capability and ongoing delivery across the group’s operating and trading entities.”
…
The firm falling into administration would be another obstacle the Labour Government will have to address as ministers attempt to lower bills and keep the UK energy sector afloat.
…In recent months, industry representatives have urged the Government to axe windfall taxes on oil giant as part of Chancellor Rachel Reeves’s Autumn Budget.
Read more: https://www.gbnews.com/money/economy-north-sea-oil-petrofac-administration-jobs-energy-tax
…
Appointing administrators in Britain is similar to US Chapter 11.
Naturally this criticism of excessive taxes appears to have triggered a finger pointing blame storm, rather than a genuine effort to fix the problem.
Swinney ‘spreading misinformation’ on Petrofac
Terry Murden, Editor | October 27, 2025
UK Energy minister Michael Shanks has accused First Minister John Swinney of spreading “deliberate misinformation” on the troubles at oil services company Petrofac.
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In a post on social media site X, he said: “This is incredibly concerning news for employees of Petrofac, their families, and the wider community. The UK Government must urgently revisit the Energy Profits Levy,” adding that “ScotGov stands ready to support all those affected by today’s news.”
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[UK Energy Minister] Mr Shanks said: “The administration of Petrofac’s top company is a product of longstanding issues in their global business. The UK arm has not entered administration and is continuing to operate as normal.
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“This is deliberate misinformation and reckless, especially from the First Minister [of Scotland]. The UK arm of Petrofac is a successful, growing company and all of us have a responsibility to support it, not to undermine it.”
Read more: https://dailybusinessgroup.co.uk/2025/10/swinney-spreading-misinformation-on-petrofac/
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The full first article also mentions Petrofac were embroiled in a Middle Eastern corruption scandal, in 2021 they were fined £70 million for paying bribes to secure contracts in the Middle East.
It is possible management incompetence contributed – getting busted paying bribes in the Middle East suggests a level of carelessness. But punitive British energy windfall taxes imposed by Britain’s deep green socialist administration can’t have helped.
The high profile bankruptcy and public argument between senior politicians risks alerting ordinary Britons to the realisation a large part of their utility bill pain is caused by energy companies passing on government taxes and compliance costs.
Whatever happens this is bad for the current UK government. If the Starmer government caves and offers Petrofac a lifeline, other North Sea companies will demand equal treatment. But if they let Petrofac fall, Scotland, traditionally a strong support base for the current administration in national elections, might change their minds about who they support.
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The green monster has been at war with the oil industry for the last 40 years. Which coincides with my entire career.
I went into oil because, at the time, mining was the bad guy.
How times change…
Well let’s hope 47 turns the tide….
A bit off topic, and a less than fully caffeinated early morning musing.
Isn’t the Climate Change hysteria a toxic mash-up of the Precautionary Principle and the Linear No-Threshold risk model?
Exactly!!
Yes. And the Precautionary Principle is a toxic re-invention of Pascal’s Wager. In Pascal it goes: even if the likelihood of the Church being right is very small indeed, it pays to bet with it, because the price of being wrong is so high – eternal damnation.
Now, let me apply this to Islam. Yes, seems to work. And Buddhism? Yes, seems to work there too, who wants to be reincarnated as a cockroach?
Of course the same argument would justify standing on our heads every morning to prevent the planet being eaten by a giant space lizard. Yes, its very unlikely. But consider the cost if we don’t do it and are wrong!
Excellent Follow-Up !
This reminds me of California abusing PG&E, Pacific Gas and Electric. Putting impossible demands on them, then punishing them for failing, then bailing them out. Then repeating the cycle.
If we only knew the whole extent of how the regulations that PG&E has suffered from the Dems running Cali, we’d probably S a brick. What little is revealed is a nightmare of permitting hassles and environmental nonsense that solves nothing. Cali’s Dems have brought it all on themselves-but, as usual, it is somebody else’s fault. I’m very sorry for the British people, not that it helps…you all have the same type of idiots/marxists in charge.
The miseries of California’s electrical industry were portrayed in Arhtur Hailey’s novel “Overload”. Written in 1979, it’s surprisingly accurate in its description of the fanaticism of eco-cultists.
It was done again by Michael Crichton in “State of Fear”. This novel so terrified Wikipedia and its editors that they devoted some space to attacking Crichton’s novel.
My pet peeve (one of them) is calling Communists something else, like “democratic socialists” or “Marxists” or “Democrats”. Karl Marx was a Communist, he called himself a Communist, and he wrote a screed he entitled “The Communist Manifesto”.
These “deep green net zero socialists” are Communists pure and simple. Communism is a cancer on civilization. Communism enslaves and kills entire populations. Communism pollutes the Earth. The people of Great Britain are suicidally insane for allowing Communists to commandeer their nation. So are we if we let it happen here.
There is no practical difference between National and Marxist socialists. The method of both regimes is mass theft by the State and mass murder of their selected victims.
If anything is certain, it is that I myself am not a Marxist.
–Karl Marx, on the Marxism which arose in France 1882.
I prefer illiberal progressives.
From my cultural understanding you can’t get any significant contract in the “Middle East” without some sort of bribery..that’s usually well included in the budget…unlikely it causes bankruptcy…not to say it couldn’t contribute.
This is correct. Its well known, but only Britain fines its own companies for doing it.
A number of years ago Citrix got caught buying a custom Boeing 767 for a Saudi Prince. To reduce their fine, they promised to put all their employees, AND the employees of all their business partners through ethics training. So because I worked for a reseller partner of Citrix, to retain reseller status, I had to take ethics training. What the British government thought they were accomplishing by ethics training for a guy in Vancouver because of what a Citrix exec did in Saudi Arabia remains a mystery to me.
It’s against the law in the US for companies to bribe officials, foreign or domestic. It’s a point that’s brought up in our yearly ethics training.
Do companies pay any attention to that “law”? Bribery of some sort seems to ‘make the world go ’roundl.
The UK is being destryed by emphatuation with Net Zero which does not have a shred of scientific justification. We must have open discussion about climate change involving the thousands of neutral, unbiased well informed scientists who doubt the mainstream narrative. The main stram self serving ideology is killing the UK. It must be exposed before we all die from a totally unnecessary poverty.
Miliband, I can assure you, remains completely wedded to the cause; and psychopathically oblivious to the consequences. – no matter the cost.
In Miliworld 40,000 real jobs become 400,000 imaginary green jobs. Bosh. Done.
Here is Miliband justifying himself and Net Zero in parliament recently….
https://www.youtube.com/watch?v=b7BFoB1ATIw
I am beginning to wonder if his obsession with Net Zero is driven less by his belief in the climate alarmist narrative and more by his Marxist hatred of fossil fuels and fossil fuel companies. Maybe the narrative is just a smokescreen to rationalize his hatred of the latter.
At any rate, Britain needs snap elections in worst way….and soon. Can King Charles call snap elections if Starmer won’t?
Parliament is above monarch and people. The king does as instructed by his government.
Only the King has the power to dissolve Parliament as the current PM must go to the monarch to request dissolution ahead of a General Election. All Acts of Parliament require Royal Assent. It is common practice for all actions of the monarch to follow the intended wishes of Parliament. Not sure what would happen if they acted independently – I guess there would be a big push to replace them with some political non-entity President elected by a handful of voters with the majority having no idea who they are. I see the UK is having the first State visit by Germany in ages for…..er, no idea. Not a clue who the German President is.
How much longer until the government just “has to” step in and take over the industry? For the good of the country of course.
And these were genuine “well-paying jobs”
Union jobs.
Designing, building and operating energy ‘facilities’ is a highly competitive industry wherein many of the international heavy hitters enjoy at least the tacit support of their own governments. Too bad for Petrofac, then, which ironically suffered from its own government’s destruction of the only market in which it might have held a competitive advantage.
Petrofac’s troubles long precede Net Zero. Here is a profit warning they issued in 2014.
Here is a more insightful analysis. It is the holding company that sought administration, not the operating company, and the problem does seem to be management. For two years they failed to get their financial results out in time.
Both are links to the same page.
The cause between 2014 and now is not the same.
The second link should lead here
The vaunted US energy dominance inevitably takes its toll on the competition.
As President Reagan famously explained liberal/progressive policy is if it moves tax it, if it keeps moving tax it some more, when it fails subsidize it.
Socialist Jeopardy, for $1000, Carbon Tax:
How a Fabian communist government would use the system to legally seize property and the means of production?
Yet more worthless corrupt government. Get the government out of the energy production and transmission business, wind and solar will go away, fossil fuel and nuclear will thrive. The grid will be protected, we will have plentiful safe, affordable and clean energy. There are damn few things government should be in charge of, energy isn’t one of them.
Eh, I think there is some distraction going on here.
For once, a politicians accusation of misinformation may have some substance.
Petrofac is NOT an oil company.
It does not do exploration.
It does not develop oil fields for production.
It does not own or have the rights to produce and sell oil anywhere.
What Petrofac is, is an Engineering Procurement and Construction contractor providing services to oil companies.
It can design, build and operate oil facilities on behalf of its clients, e.g. oil companies, but it does not own these facilities.except temporarily under the very limited ownership rights of Build-Own-Operate-Transfer contracts.
Petrofac’s website contains press releases describing a financial restructuring process extending back to early 2024. It has been going bust for a long time. Preceding the latest announcementits press release on 17 October included the following statement:
“Further to its announcement on 1 October 2025, in which the Company advised it was advancing more than one route to implement the Restructuring, it today confirms that the Restructuring will result in no residual value being retained by existing shareholders.”
https://www.petrofac.com/media/news/restructuring-update-17-october
In other news from the UK…. The report is from the UK Telegraph.
The Government’s new estimates slashed the predicted “load factor” – the proportion of the year turbines are expected to generate power – from 61pc to 43.6pc for offshore wind. The estimated load factor for onshore turbines was also revised down, from 48.7pc to 33.4pc.
And notice something: this load factor is the amount of power produced, no matter when. The real load factor is far less, because a big chunk of this power is produced when there is no demand for it, so its totally useless.
When you add all this up, Miliband is going to have to pay far more per MWh than previously estimated. But those MWh are not what they seem, and by the time you adjust for the mismatch between demand and production, they will be even lower.
This is not working, cannot work, will not work. There is no way to produce 95% of UK electricity from wind and solar, not by 2035, nor indeed by any date.
Or perhaps we should say, there is no way to do this while having a recognizable economy and society anything like what we have now. You can do it, or try to do it, but the price will be people sitting in the dark in winter wrapped in duvets eating cold baked beans and not even able to boil a kettle for tea and hot water bottles. And an economic and financial disaster a lot worse than the thirties of the last century.
The government in power, and the previous government when it was in power, seems to have no idea what a week long blackout will mean in a modern society. It means nothing works. No gasoline, pumps don’t work. No gas heating, same thing. Heating in the UK is gas powered – requires power for pumps and burners. No mobile in most places – power out to the towers. Nothing in the supermarkets, ordering and procuring is offline, and anyway, the trucks can’t get refueled. No cash machines. No TV. No refrigeration. It means total disaster.
This is what the present government is driving to. But its also where the last government was driving to with equal speed, and its what all political parties in the UK with the exception of Reform have applauded and voted for. Yes, the Conservative Party leadership has backed off lately from what they applauded in office a couple of years ago. But a substantial part of that party is still on board with Net Zero, and the cowardice of the Tories when in office is a very poor omen for any effective action if they ever return.
The truly frightful thing about this is that everyone knows Net Zero is impossible nonsense. And yet no-one, except Farage and Reform, has the intestinal fortitude to call it!
Taking supermarkets as one example, in a power failure you cannot get in as the doors are all electrically operated. Unlike in the days of the miners strike and rolling powercuts, they cannot sell you anything as the scanning tills are all electric. None of the goods have price labels anymore. People do not have money anymore and would not be able to get any.