The Irish unit of a Norwegian-owned energy firm last year enjoyed soaring pre-tax profits of €289.8m from its share in the Corrib Gas Field - and paid no corporation tax.
Instead Equinor Energy Ireland Ltd received a corporate tax credit of €89.17 million on its 2021 profits.
A surge in gas prices in the second half of last year contributed to Corrib Gas Partner Equinor recording pre-tax profits of €289.8m for last year.
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New accounts show that Equinor Energy Ireland Ltd recorded the large profits as revenues increased almost three fold from €103.2m in 2020 to €304.18m last year.
The pre-tax profit of €289.8m follows pre-tax losses of €138.9m in 2020 - a positive swing of €428.72m.
The accounts show that the company would have been liable to corporation tax charge of €72.45m based on the standard rate of tax of 25% on such energy operators.
However, because of tax rules, the firm instead received a corporate tax credit of €89.17m, resulting in post tax profits of €378.97m.
The firm recorded the corporate tax gain of €89.17m after utilising previously deferred tax assets of €89.17m, use of tax losses of €53.22 million and timing differences between depreciation and capital allowances totalling €19.59m.
The accounts state at the end of last year, the firm had tax losses of €980m that are available to offset against future taxable profits.
In November of last year, Equinor agreed to sell its entire 36.5% stake in the Corrib Gas Field for $434m to Canadian firm, Vermilion Energy before closing adjustment with effective date of January 1 this year.
The directors state that as part of the deal, Equinor and Vermilion agreed to hedge approximately 70% of the production of the Corrib gas field for 2022 and 2023, and have also agreed a contingent payment that will be paid on a portion of the revenue if European gas prices exceed a given level.
The directors state that the transaction “is scheduled to complete in the second half of 2022”.
The profits last year also take account of non-cash depreciation costs of €108.55m.
The directors state that in 2021, there was significant price volatility, primarily triggered by high economic growth and subsequent supply chain bottlenecks on the back of measures to contain the Covid-19 pandemic”.
Equinor last year paid out a dividend of €100m. The book value of Equinor’s share of the Corrib Gas Field last year increased from €156.44m to €226.28m.
This arose chiefly as a reversal of an €184.9 million impairment.
At the end of December last, the Irish Equinor unit had accumulated profits of €451.6m.
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