The Future of the North Sea Oil & Gas Sector
Posted on: 18/06/2014

The UK North Sea oilfields are estimated to potentially hold a further 24 billion barrels of recoverable oil in untapped reserves; with Norway adding another 18 billion barrels, this should ensure another 30-40 years’ worth of production.


Capital investment in greenfield and brownfield developments in the region therefore looks set to grow (at least for the short to medium term) with figures for 2014 looking to exceed £20 billion; which is an increase of over 40% on 2013 figures. The long-term is less certain due to the growing costs of exploration and production activities and, specifically for the UK sector, great uncertainty over the impact of potential Scottish independence.

The Scottish Government has predicted that the next 4 years could generate over £57 billion in tax revenue. With the “YES vote” campaign seeking to distribute a larger proportion of this wealth north of the boarder, the industry and investors are wise to be cautious. It is little wonder many are forecasting a decline in new expenditure from 2015 onwards as investment capital migrates to higher-margin markets; creating opportunities for the major players to reduce their matured North Sea portfolios to focus on emerging developments and new markets.


The rising staff and material costs, limited access to new equipment in the region and a lack of exploration success has led to a significant decrease in North Sea drilling activities over the past 4 years. This has compounded the effects of the steady decline of North Sea oil production from a peak of about 6 MM BOPD in the early 1990’s to the current level of 2.5 MM BOPD, with the gas sector also seeing similar declines.

Still the future looks bright, significant new exploration and production opportunities still exist in deep water and harsh-environment regions, such as West of Shetland and Heavy Oil Developments. Advances in implementation of enhanced recovery technologies may also extend maturing assets further than current predictions. Strategic decommissioning and greater environmental responsibility will give rise to new opportunities for many emerging companies and professions within the sector. One dynamic proposal includes utilising exhausted North Sea oil and gas fields and transforming them into lucrative CO2 emissions dumps for Europe, promising additional investment, jobs and infrastructure for the UK. In potential plans, nearby nations would capture the emissions from their power stations, then transport it offshore via pipelines and pump the unwanted CO2 back into the depleted rock voids.

It seems despite potential political, environmental & investment volatility the North Sea is set to enter a dynamic new era, presenting many new challenges but also plenty of new opportunities for future growth and reward.
 

 

Vacancies By Email

Get There First With Vacancies By Email

Get specific job types, tailored to your requirements, sent straight to your inbox as soon as they are available. Register Now »

Latest Oil & Gas Jobs

Structural Engineer Contract | London, London, England | £60.00 Per Hour

We are currently seeking a Structural Engineer to join our client on a 3-4 month contract basis in London.
Read More »

Offshore / Naval / Structural / Installation Engineer Permanent | London, England | £55,000 Per Annum

We have a new opportunity for an Offshore Engineer to join an independent marine and engineering consultancy on a permanent basis in London.
Read More »

Tendering Coordinator Permanent | Kingston upon Thames, Surrey, England | £40,000 Per Annum

We have an excellent opportunity for a Tendering Coordinator to join a leading oil & gas company on a permanent basis in Kingston-upon-Thames.
Read More »

Naval Architect / Structural Engineer Permanent | London, England | £42,000 Per Annum

We have a new opportunity for a Senior Naval Architect / Structural Engineer to join an independent marine and engineering consultancy on a permanent basis in London.
Read More »

Expert Subsea Umbilicals Engineer Permanent | Edinburgh, Scotland | £65,000 Per Annum

We are currently seeking an Expert Subsea Umbilical’s Engineer to join a specialist contractor within the Oil & Gas industry on a permanent basis in Edinburgh.
Read More »