As the North Sea continues to attract record investment, the scale of opportunity for the supply chain is growing, says the EIC.
The growth is characterised by four key areas of activity: small or marginal developments, led by a growing number of independents; major developments in frontier areas, driven by IOCs; redevelopment and expansion projects, using new technologies to extend field life or tie in smaller discoveries; and decommissioning.
According to EICDataStream, there are 146 projects proposed or under development offshore UK, worth a total potential investment value of US$88.4 billion (£57.6 billion). The majority of these are field development and exploration projects, with independents growing their presence in this area.
Of the 81 field development projects currently under development on the UKCS, 39 are being led by independent operators, accounting for an estimated US$14.4 billion investment.
Independents, such as EnQuest, Talisman and Endeavour, were particularly successful at securing licences in the UK’s 27th oil and gas licensing round, with only a handful of the 167 licences awarded going to majors.
As of November 2012, 26 exploration projects out of a total of 60 were being led by independents and, given the results of the licensing round, this is expected to increase.
Oil and gas companies are also working to access declining reserves through redevelopment of existing infrastructure. According to EICDataStream, there are 14 redevelopment projects on the UKCS, worth a total estimated investment of US$17.4 billion.
These include BP’s Clair Ridge expansion project and the Quad 204 redevelopment project at the Schiehallion and Loyal fields.
A growing market in decommissioning activity as installations become redundant, is also expected.
According to EICDataStream, there are currently nine decommissioning projects, worth a total potential investment of US$2 billion on the UKCS.
EIC, whose members’ pavilion can be found in Hall 3, says the UKCS remains an attractive proposition for the oil and gas industry, yet, at a time of declining field rates and complex reservoirs, nurturing technology and embracing innovation is more important than ever.
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