Oil & Gas UK estimates exploration and production companies would have to spend about $265 billion between 2019-35 to realize industry’s expectations outlined in Vision 2035 on the UK Continental Shelf (UKCS).
Vision 2035 is a framework for the UKCS led by Oil & Gas UK and the Oil & Gas Authority.
An Oil & Gas UK business outlook said pretax E&P expenditure on the UKCS was about $19 billion in 2018. Pretax E&P expenditures are expected to increase to more than $19.8 billion in 2019.
The report shows UKCS production was about 619 million boe in 2018. This figure marked a 4% increase on 2017 and a 20% rise over the previous 5 years, the report said.
Despite low 2018 drilling activity, industry discovered an estimated 485 million boe last year. More new projects were approved in 2018 than the previous 3 years combined, the report said, adding that up to 15 exploration wells are expected to be drilled in 2019.
Oil & Gas UK Chief Executive Officer Deirdre Michie urged suppliers and operators to collaborate to improve costs. “Our report finds an industry that’s getting better at what it does,” Michie said. “However, challenges remain across parts of the supply chain with revenues and margins still under pressure.”
