|Bitumen Africa|

Thursday, June 20, 2024 14:00

Could European majors relocate to the United States?

If so, would this move have any advantages for them?

These were the questions Rigzone posed to several analysts in exclusive interviews, in an effort to better understand the likelihood of such a scenario, as well the benefits.

“It is a widely shared perception these days that there’s no better place to be a listed oil and gas company than America, owing largely to its relatively fossil fuel friendly investors,”

Patrick Rutty, the Director of Global Intelligence at Enverus, told Rigzone, in response to the questions.

“From a vantage point in the States, that might seem a surprise, but if you think Wall Street and Washington have turned against the industry, you’ll need stronger language to describe the antipathy in places like London, Paris, or Amsterdam, where P/E [price-earning] ratios of supermajors are said to be about 25 percent lower than their peers in New York,” he added.

“Already this year, French supermajor Total 0Energies and the UK’s Shell and BP have all publicly addressed re-listing in New York, although BP has been the coolest on the idea, stating its focus is on quarterly deliveries,” Rutty went on to state.

The Enverus director highlighted to Rigzone that, back in 2021, Royal Dutch Shell “shucked its first and middle names”

and changed tax residence from the Netherlands to the UK,

“following a Dutch court ruling that the company’s carbon emissions plans weren’t ambitious enough”.

Rutty added, however, that the company’s new home in London “may have also become problematic, as the repercussions of Brexit continue to ripple through British capital markets and investor groups”.

“Though often mooted as another reason to move, Westminster’s 2022 Energy Profits Levy – essentially a windfall profits tax – applies only to companies’ UK-sourced oil and gas production,” Rutty told Rigzone.