Looking ahead: The North Sea in 2014
A recent report has suggested that 2013 was a mixed year for the North Sea oil and gas industry, and that 2014 promises to be a potential game changer for the UK.
In Wood Mackenzie’s annual UK upstream oil and gas review, 2013 was deemed a year of both continued investment, but also frustrated projects. In summary:
- Capital investment continued to increase
- Project delays, production under-performance and poor exploration success
- High levels of activity and stretched resources have also led to project delays
- Only 13 new fields were brought on-stream in 2013, which was lower than the 21 expected at the start of the year
- Merger and acquisition spend in the UK slumped in 2013 to £1.1 billion compared, to £6.1 billion in 2012
The report also highlighted the following predictions for 2014:
- 14 new fields with 438 million boe to be brought onstream
- Expect to see deal activity increase in 2014, albeit on the back of low levels in 2013 as some of the larger players will continue to look to optimise their portfolios
- The Scottish independence referendum in September could ultimately lead to a division of oil and gas assets between Scotland and the rest of the UK
The key to 2014 may be the final point, when the Scottish referendum could change how the UK oil and gas industry operates.
Wood Mackenzie’s head of UK upstream research, Lindsay Wexelstein adds: “Although some uncertainty remains over the longevity of the sector, 2014 could prove to be a pivotal year for the UK’s North Sea.”
Read other reviews of the report here: