A major oil and gas producer is making plans to cut about 250 jobs in Aberdeen.

Harbour Energy said it had launched a review of its UK operations and had to take “difficult steps”, blaming regulation and “punitive” government measures.

Aberdeen and Grampian Chamber of Commerce (AGCC) described the news as a “devastating blow”.

Harbour Energy had previously announced the loss of 350 UK onshore jobs in 2023.

The firm has been a vocal critic of the Energy Profits Levy, known as the windfall tax, introduced by the Conservative UK government in 2022 and extended after Labour came to power last year.

The UK government said at the time it was strengthening the tax to ensure North Sea oil and gas producers contribute their fair share towards the energy transition.

It has also pointed to its decision to headquarter Great British Energy in Aberdeen and establish a national wealth fund to help unlock investment in renewables.

But Harbour Energy has claimed it faces excessive taxation which threatens profits and investment in its North Sea operations.

Scott Barr, managing director of the firm’s UK business, said a review of its UK operations was expected to result in 250 job losses in Aberdeen in addition to the 350 previously announced.

He said: “The review is unfortunately necessary to align staffing levels with lower levels of investment, due mainly to the government’s ongoing punitive fiscal position and a challenging regulatory environment.”

Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce, said: “This is a devastating blow for the 250-plus families directly affected – and I fear it is just the tip of the iceberg.”