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Major Oil and Gas Operators Share Perspectives on the Future of the North Sea

Two of the UK’s top offshore oil and gas business leaders today highlighted to more than 400 delegates at Oil & Gas UK’s breakfast briefing what is required to help realise the full potential of the UK’s remaining resources. The event, sponsored by The Royal Bank of Scotland, was held at Aberdeen Exhibition and Conference Centre.

BP and ConocoPhillips are among the largest operating companies currently active in the UK Continental Shelf (UKCS), whose efforts over the past forty years of production have helped the UK offshore oil and gas sector become a global centre of excellence in engineering, manufacturing and technology as well as an established provider of energy, employment, investment, exports and tax revenues for the UK economy.

Paul Warwick, president UK and Africa at ConocoPhillips, started off by presenting an historical perspective of the oil and gas industry over the past forty years, noting that while the UK oil and gas industry is consistently the country’s largest industrial investor, it also faces the significant challenge of operating within a high cost province. With exploration, development and operating costs of increasingly technically challenging projects continuing to rise, Mr Warwick explained that the key to unlocking the full potential of UK’s oil and gas resource is to ensure investment is attracted and that the focus on maintaining infrastructure is retained.

Paul Warwick said: “The key objective is to show that a stable fiscal regime will incentivise investment and extend the longevity of ageing offshore infrastructure. In turn, this will allow increasingly smaller fields to be developed, leading to economic and security of supply benefits for the UK.”

Trevor Garlick, regional president of BP North Sea, outlined his company’s long-term strategy for the UKCS. This is focused on four key areas - improving asset integrity to extend the life of those assets; progressing new exploration and appraisal wells and new satellite options; delivering new major projects efficiently and ensuring the deployment of the technology that will allow more recovery from our reservoirs. Mr Garlick then shared BP’s perspective on the various challenges of doing business in the UK within a wider North Sea context.

Trevor Garlick said: “As is evident from BP’s announcements in recent months there is significant potential remaining in the UKCS and the resources exist to allow for several more decades of production. Delivering the potential will require continuous progress in safety and reliability, greater efforts to develop skills, a competitive fiscal regime, sustained investment in infrastructure and the more consistent application of technology,”

Mike Tholen, co-author of Oil & Gas UK’s 2011 Economic Report, provided the contextual framework for the breakfast briefing as well as presenting the main findings of the report, including the industry’s economic contribution and capacity to foster excellence in engineering, manufacturing and technology.

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