UKCS Operating Costs Drop
Operating costs in the UK Continental Shelf (UKCS) dropped by 14 percent in 2016, with operators securing reductions of approximately $1.5 billion (GBP 1.1 billion), according to a new report from the Oil & Gas Authority (OGA).
The inaugural Analysis of UKCS Operating Costs in 2016 report revealed that total operating expenditure (OPEX) for the UKCS was $9.6 billion (GBP 7.2 billion) in 2016 compared with $11.1 billion (GBP 8.3 billion) the previous year. Prior to 2014, OPEX was escalating in the UKCS, exacerbated by the low oil price environment, according to the report.
Over 50 percent of operators secured OPEX reductions during 2016, the report showed, although the majority of this cost saving was dominated by four operators who achieved 60 percent of overall OPEX reduction during the year.
The range of operators who achieved reductions in operating cost was diverse and included new entrants, national oil companies, oil majors and independents.
Total OPEX is expected to remain relatively constant to 2022, according to the report, which outlined a number of methods to facilitate ‘sustainable improvements’ to the sector going forward.
These include the continuous improvement of production efficiency, while maintaining high safety standards, continued focus on improving the efficiency of business and operational processes, further consolidation of assets and infrastructure across the UKCS, and a close working relationship between the MER UK Technology Leadership Board and the Oil & Gas Technology Centre to support the development of technology that can deliver further operational cost efficiencies.
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Rystad Looks at the Buzz Around White Hydrogen
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension