UK government urged to stimulate development

Offshore staff

GLASGOW, Scotland -- Hannon Westwood claims that the UK government should do more to attract investment to the UK North Sea.

According to the analysts, the government is missing out on $44 billion potential tax revenue from 600,000 boe/d from discoveries yet to be developed.

The analysts have identified 90 fields in this category across the UK continental shelf that could be brought onstream over the next five years, producing collectively 2.6 Bboe.

These fields, they add, could provide funding solutions to the cost of preserving offshore export routes; create and securing 60,000 jobs; and deliver indigenous oil and gas supplies estimated at around $50 billion in capex and opex.

The required capex investment is calculated at around $33 billion. However, issues such as complex ownership and geography would make it difficult for the market in its present state to manage the scale and complexity of the funding requirement.

Hannon Westwood claim that government intervention, in the form of tax allowances, might prove more helpful in the present circumstances than market forces, and may provide the catalyst to drive these near-term developments where the markets fail.

Director Jim Hannon said: “New North Sea oil and gas has a real role to play in managing our transition to a greener economy in term of jobs, taxes and security of supply; but the barriers to new production are immense, and we stand to leave supplies in the ground unless we change the investment landscape”


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