New oil and gas industry figures highlight continuing buoyancy in the UK North Sea.
Professional service firm Deloitte said yesterday the number of new wells drilled on the UK continental shelf (UKCS) during the second quarter of 2013 was down slightly, compared with the same period last year, but exploratory activity remained healthy.
It said 16 exploration and appraisal wells were drilled in the UK during the latest period, seven more than in the first quarter of 2013 but two fewer than the same period last year.
Despite the slight fall on 2012’s figures, Q2 2013 still produced two more new wells than the quarterly average since the end of 2011; a year with the lowest activity since 2003.
Across north-west Europe, 35 new exploration and appraisal wells were drilled in the latest period; 10 more than in Q1 and the same as in the second quarter of 2012.
Development activityis also holding strong, with six fields granted development approval and four coming on stream in UK and Norwegian waters in the latest period. Graeme Sheils, energy partner at Deloitte in Aberdeen, said: “This quarter’s stable drilling figures should not detract from the fact that the UKCS is experiencing high activity levels. The market is . . . buoyed by . . . factors, including a stable oil price, increasing investment and (UK) Government incentives.
“With a more positive domestic outlook also beginning to emerge across the rest of the UK, there is a lot of confidence in the outlook for the North Sea sector.”
Mr Sheils said frontier areas such as offshore west of Ireland were also attracting attention.
Deloitte’s figures come in a report from the firm’s petroleum service group, whose managing director, Graham Sadler, said they were in line with what would be expected from a mature region such as the UKCS.
Mr Sadler added: “These figures indicate the UKCS remains a strong and productive sector, which bodes well for the final two quarters of the year.
“I fully expect to see further positive figures in quarters three and four as the region recovers from a prolonged and harsh winter, which was followed by an unusually late spring.”
One of the notable features of Deloitte’s report is a significant increase in farm-in style agreements, where one company takes a stake in another firm’s field; often to assist with drilling or development costs. Farm-ins accounted for around 70% of north-west European oil and gas deals during Q2.
Mr Sadler said: “Farm-ins allow smaller companies to benefit from pooling resources and equipment such as drilling rigs, enabling them to access existing North Sea reserves.”
Recommended for you
