Page 6 - Gi flipbook_May 2019

industry & Government news

DIGEST pivotal for “adding a generation of
The £200 billion figure is seen as
productive life” to the area.
OGUK Chief Executive Deirdre Michie
said the report showed that industry’s
approach during the downturn was
delivering results.
She said: “Following 14 years of decline,
production has increased by a fifth over
the past five years. Cost improvements
UK OIL AND GAS INDUSTRY are being sustained and there is building
momentum around exploration, with
more new opportunities being drilled
‘NEEDS £200BN OF and the largest two conventional
discoveries for a decade made in the
second half of 2018.
“Our report finds an industry that’s
getting better at what it does, getting
smarter in how it does it and is well
INVESTMENT’ FOR FUTURE positioned to deliver attractive returns
DEVELOPMENT maintaining our global competitiveness.
on investment within this environment,
“This is the new reality and we need
to embrace it.”
She acknowledged that supply chain
companies faced challenges with
revenues and profit margins still under
pressure, and cash flow stretched.
“If capabilities and resources are to
stay anchored here in the UK, there
must be a competitive proposition for
supply chain companies to invest in
too,” she added.
“With focus on adding a generation of
productive life to the basin, our report
reveals around £200 billion will need
to be spent to find, develop and operate
the reserves of the future.
“This is a UK industry which is
critical for security of energy supply,
at the heart of the move to a lower
carbon economy, supports hundreds
of thousands of jobs and contributes
billions to the economy.
“With the new reality clear and clarity
around the future potential, there is all
to play for.”
Scotland’s Energy Minister Paul
Wheelhouse said the report showed
that the strategies adopted by
operators and the supply chain were
now helping to deliver sustained
efficiencies across the sector.
He added: “However, it is clear that
UK EXPLORATION AND PRODUCTION HAS EXPERIENCED 14 YEARS OF DECLINE more needs to be done to realise the
industry’s Vision 2035, including
diversification into new areas such as
A TOTAL OF £200 BILLION needs to be The study reveals production has transitional technologies and areas
spent by exploration and production increased by 20 per cent over the past such as hydrogen production, and
companies to fully exploit the UK oil five years. This follows 14 years of providing sustainable opportunities for
and gas sector’s remaining potential, a decline, according to the BBC. the supply chain which, while seeing
new report has said. The report found 62 per cent improvements, is still continuing to
Industry body Oil and Gas UK (OGUK) of contractor companies had an face challenges in some areas.
said its Business Outlook Report 2019 improved outlook for 2019, but that “That’s why we continue to press for
showed the need for a focus on cost and many areas of the supply chain were more action by UK ministers to stimulate
efficiencies was the “new reality”. still facing challenges. further investment in the sector.”

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News.indd 1 16/04/2019 19:34