Few other sectors could have matched the British energy industry’s reaction to the challenges it has faced over the past 18 months, the chief executive of Oil and Gas UK (OGUK) said.
Deirdre Michie said the oil and gas industry had shown its resilience by reducing costs and increasing production for the first time in 15 years last year.
Companies have also shown their willingness to work together on projects such as inventory management and the standardisation of subsea projects, she said.
But Ms Michie warned morale was low and that the supply chain needed immediate support or it would disappear.
She said: “Knowing that we can’t control the oil price, we have shown leadership and focused our energies on areas we can influence.
“Improving our efficiency and reducing our cost base has seen us increase production and reduce our unit operating cost by a remarkable 40%.
“Recognising that our competition is outside this basin has spurred us all on to deliver to levels I don’t think we would have considered possible 18 months ago. We are pleased with the progress our Efficiency Task Force is making.”
She added: “Stimulating activity is key to providing some immediate relief and support to the supply chain.
“If we don’t do something urgently, the current hiatus in exploration and appraisal that I referred to earlier, will become the norm, with the basin focusing mainly on production and decommissioning.
“Our world class supply chain will disperse and relocate – as businesses take their focus elsewhere.
“We are currently working closely with the Treasury and the Oil and Gas Authority looking to see what form such an intervention could take – and hope to make tangible and near term progress.”
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