A number of challenges including the windfall tax as forced energy company Parkmead to abandon a proposed development in the North Sea.

Parkmead said rising costs, as well as skills shortages and ageing infrastructure contributed to it pulling out of the Perth project.

The main Perth Field holding an estimated 55 MMboe but asccording to Parkmead, the wider GPA project could deliver 75 MMboe to 130 MMboe via tie-ins to existing infrastructure.

A lack of public and political support for new oil projects resulted “in a very cautious and conditional approach from industry”.

The Aberdeen-based company’s comments came hours after Labour leader Sir Keir Starmer said new oil and gas exploration would be banned once existing licences expire.

Parkmead said it would take a £33 million non-cash impairment charge and two licences will not be extended.

In a statement, Parkmead said it will pivot towards gas assets and electricity from renewable sources and focus on existing North Sea assets that can de be developed quickly. Parkmead has wind farm interests in Scotland.

The company said it had received several expressions of interest from potential partners to develop Perth. However, updated spending projections, including measures to comply with net zero goals, meant the development would have cost up to $1 billion.

Executive chairman Tom Cross said: “Over recent years a great deal of our team’s effort has been directed at trying to unlock the complex Perth area.

“Our team is naturally disappointed that despite these huge efforts, working closely with neighbouring operating companies and highly skilled supply chain companies, the combination of challenging factors means it is not economically viable to take the project forward. “

He added Parkmead remains in a strong position with the “exciting and significant upside offshore that Skerryvore presents in the near-term, and the Fynn Beauly and Fynn Andrew assets in the medium-term, together with any new licences”

Shares fell 5p or 21.6% to 14.5p.

The news comes a week after Ryan Stroulger, finance director, left the company by mutual agreement.

Mr Stroulger had been a key member of the management team since its foundation in 2010.