UK Offshore Oil and Gas Production Continues to Decline in 2013

UK oil and gas production fell by 14.5% to 567 million boe in 2012, cementing fears for the energy security of the country.

‘In 2012, only nine new fields with total reserves of 146 million boe began producing. Much more encouragingly, we anticipate that 15 fields, with combined reserves of 470 million boe, will come onstream in 2013. The Banff, Gryphon and Elgin fields are also coming back onstream, but over the year, production is now forecast to fall to a range of 1.2 to 1.4 million boepd,’ reads a note released by Oil & Gas UK on Wednesday.

Oil & Gas UK, the leading trade association for the United Kingdom offshore oil and gas industry, sees a decline in 2013 similar to the one of last year, despite the investments of the industry and the centrality of gas and oil in the UK energy portfolio. Previous estimates were much rosier, predicting a margin decline as little as 2.5%.

“Despite impressive investment in new developments, the production efficiency of existing assets remains in worrying decline. DECC and the industry are working to tackle this serious concern through a joint task group,” commented Oil & Gas UK’s chief executive Malcolm Webb.

The offshore oil and gas industry generates almost £40 billion a year for the economy by producing oil and gas worth £32 billion. The UK remained the third largest producer of gas and second largest producer of oil in Europe in 2012.