The last years have demonstrated the resilience of UKCS. Both production and production efficiency have increased. It is a matter of strategy.
Since 2014 the UKCS has undergone a transformational change, writes OGA in their first edition of its Investor Overview.
The UKCS, like other basins, was hit hard by the downturn in oil price. But instead of decline, the UKCS has seen production and production efficiency increase year-on-year whilst operating costs almost halved.
HM Treasury have played their part, creating a globally competitive fiscal regime, and the capital markets have been active with record levels of M&A activity; including the first sustained move by private equity into the UKCS and the change in midstream ownership away from E&P companies to specialist infrastructure funds, writes OGA.
Two years after the oil price downturn, the UKCS has turned a corner. The OGA has had two successful licensing rounds, demonstrating both the continuing exploration potential in the basin and the value of over 3 billion barrels of oil equivalent (boe) of discovered resources.
Vision 2035 aims to deliver an additional 3.7 billion boe already added to 2015 projections.
OGA highligths that UK lifting and development costs have reduced on a per barrel basis since 2012 making the UK globally competitive.
Huge potential: Go find it!
In their review, OGA also states that the UKCS has considerable discovered resource base (more than 3bnboe) and another 6bnboe Yet To Find. In addition, OGA emphasizes success from late life assets, using the Beryl area, Anasunia cluster and Sean area as exaples. High quality seismic acquisition and processing as well as successful near field infrastructure-led exploration are reasons for success.