Rystad: Global output declines from mature oil fields accelerating

Production from maturing oil fields is declining faster globally due to the fall in capital spending since the oil-price crash, Oslo-based industry research firm Rystad Energy AS observes.

Content Dam Ogj Online Articles 2017 10 Rystad Global Spending Mature Fields

Production from maturing oil fields is declining faster globally due to the fall in capital spending since the oil-price crash, Oslo-based industry research firm Rystad Energy AS observes.

The firm largely attributes the relatively stable global production since 2015—despite the decreased spending—to project startups that were approved before the price collapse that began in mid-2014. Meanwhile, drilling of new wells on mature fields has dropped by about half since that time.

Mature offshore oil fields now decline at a rate of 8%/year, Rystad says, whereas the same fields declined by just 5% in 2014 before the decrease in drilling activity.

Content Dam Ogj Online Articles 2017 10 Rystad Global Spending Mature Fields

“Old offshore fields are now declining faster, and as a consequence, 1 million bbl of oil have been removed from production balances,” said Magnus Nysveen, Rystad head of analysis.

As of early October, global oil and liquids production totaled 97 million b/d, exactly 10 million bbl higher than at the start of this decade, according to Rystad data. The firm predicts a continued shift of market share from conventional oil production to US shale oil.

“We expect US oil production will continue to ramp-up towards its full potential of 15 million bbl within the next 5 years, and then we would again see quite a dramatic tightening of the oil market,” said Nadia Wiggen Martin, Rystad vice-president of markets.

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