Oil and gas firms will slash investment in the North Sea by around 80
per cent in coming years following the oil price slump potentially
leaving parts of the area abandoned, industry leaders have warned.
The cuts in spending could result in billions of barrels resources going unrecovered including 1.7 billion held in existing fields, it is feared.
The warning follows publication of the latest survey of North Sea firms by Oil & Gas UK. This shows the fall in the oil price since June is taking a heavy toll on the area, where firms have radically cut their investment plans over the last year.
The industry body found the UK North Sea industry spent £5.3bn more than it got from oil and gas sales last year, the worst result since the 1970s. The tax take for the UK Government fell by 40 per cent to £2.8bn, the lowest level in more than 20 years.
Oil & Gas UK found annual investment in projects like bringing new fields into production is set to fall from a record £14.8 billion last year to just £2.5bn in 2018.
With the industry facing greater uncertainty than ever, Oil & Gas UK said a number of projects that have been approved may yet be cancelled.
Malcolm Webb, chief executive of Oil & Gas UK, said the survey painted a bleak picture of conditions in an industry that supports hundreds of thousands of highly skilled jobs. Many of these are in Scotland.
Read more: Oil and gas industry leaders warn: slump in investment could devastate North Sea | Herald Scotland
The cuts in spending could result in billions of barrels resources going unrecovered including 1.7 billion held in existing fields, it is feared.
The warning follows publication of the latest survey of North Sea firms by Oil & Gas UK. This shows the fall in the oil price since June is taking a heavy toll on the area, where firms have radically cut their investment plans over the last year.
The industry body found the UK North Sea industry spent £5.3bn more than it got from oil and gas sales last year, the worst result since the 1970s. The tax take for the UK Government fell by 40 per cent to £2.8bn, the lowest level in more than 20 years.
Oil & Gas UK found annual investment in projects like bringing new fields into production is set to fall from a record £14.8 billion last year to just £2.5bn in 2018.
With the industry facing greater uncertainty than ever, Oil & Gas UK said a number of projects that have been approved may yet be cancelled.
Malcolm Webb, chief executive of Oil & Gas UK, said the survey painted a bleak picture of conditions in an industry that supports hundreds of thousands of highly skilled jobs. Many of these are in Scotland.
Read more: Oil and gas industry leaders warn: slump in investment could devastate North Sea | Herald Scotland
