Monday, 24 February 2014
Most of their reservoir is depleted now
On a quick facts basis here are some rather key ones too:
- UK production is expected to drop to 800,000 barrels a day this year, down from a production peak of 2.92 million in 1999. That is, umm, a 75% drop in production in just 15 years.
- With huge investment needed into getting North Sea production back on-line, it is unlikely this will go over one million barrels per day ever again.
- The decline is North Sea production is the fastest of any large system in the World over the past decade.
- The UK became a net importer of oil again in 2007.
- Newer North Sea companies, such as Xcite Energy (tipped here many a moon ago, but struggling still) are really struggling to find finance. This is because their cost of to pump the oil is at $80 barrels plus and the oil is much heavier than Brent - so less valuable. Taking this into account is huge as it means the margin available to tax is far slimmer. Even if these companies are successful and we have more successful drilling in the likes of the Bressay field and others, the tax revenues potential is far less than was the case with the Forties field.
So basically, Salmond and Cameron can discuss all they like in Aberdeen about UK offshore oil reserves, but this is yesterday's story in many ways. The future will be Fracked gas onshore in the UK - sadly for Scotland much of this is in England.