The annual survey of the investment and development plans of 28 UK offshore oil and gas producing companies is commissioned jointly by the UK Offshore Operators Association (UKOOA) and the Department of Trade and Industry (DTI).
It suggests that on current trends the Industry will be spending more to deliver less oil and gas, as depleting reserves in existing fields become more difficult and costly to replace with new developments. Clearly, this trend must be arrested, UKOOA says. Greater capital and operating efficiency will be key to future business success on the UK Continental Shelf (UKCS), as will continuing co-operation between the Industry and Government. The substantial investment in new technology of recent years, along with the vast network of existing infrastructure and the contribution of over 600 new wells drilled over last two years, will also be vital in maximizing economic recovery.
The survey's key findings and associated industry statistics are:
Beverly Mentzer, Chair of UKOOA's Fiscal Policy Group, said: "Managing a business as production declines requires different application of the skills and disciplines that have been successful during the growth of the UKCS in the first half of its life. We have to demonstrate capital and operational efficiency in an increasingly competitive global market to attract the resources that are vital to our ability to maximize economic recovery of UKCS oil and gas reserves. Government's design of the fiscal regime also significantly influences the international competitiveness of the UKCS."
Michel Contie, UKOOA President, said: "The survey indicates that the UKCS is at a critical point in terms of its international competitiveness due to the maturity of the basin. The Industry will do all it can to maximize the economic recovery of remaining discovered and undiscovered reserves. To secure those reserves the UK must retain an adequate offshore infrastructure, which is particularly important in terms UK gas supply.
"Operating companies in the UKCS have the ability to deliver, in co-operation with an effective supply chain, and, more and more, the support and long term vision of Government and the regulators," Michel Contie said.
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