General: North Sea Output To Tumble, Claims Union
Posted on 12.09.2006 - 03:37 EDT in GENERAL NEWS by Rons_ROV_Links
An Offshore union claims that UK North Sea oil and gas production will fall sharply in the next few years if not enough is done to attract more small independent companies to exploit marginal fields.
The OILC also contends it is vital that more money is spent on maintaining existing infrastructure, such as pipelines.
The union will publish a report later this month.
It will argue that, while there has been a slowdown in the rate of decline from 17% in April to 8% in August, the long-term outlook is that the rate of decline will be established at 17% by 2007-8 without significant increases in investment.
Jake Molloy, general secretary of OILC, said the production levels hoped for by the Department of Trade and Industry would not be met unless extra money was spent.
At the end of last month, the latest Royal Bank of Scotland oil and gas index reported that the decline in UK North Sea production has been continuing.
Combined daily average output in June was 2,570,537 barrels of oil equivalent per day - down 13% on the previous month, while annual production fell 18%.
That was the worst figure in 13 months and it was well off the high in this period of nearly 3.35million barrels a day in January.
Steve Harris, communications director at the UK Offshore Operators' Association, said at the time that the figures from the Royal Bank survey were disappointing, but did not tell the whole story.
UKOOA members were investing at near-record levels, while it was estimated that the workforce offshore has swelled by about 20% in the last 12 months.
Mr Harris said that the fall reported by the Royal Bank was because of reduced demand for gas in June because of the warm weather and annual maintenance being brought forward.
But he conceded that production was not picking up as much as the UKOOA would have liked.September 11, 2006
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