Industry body Oil and Gas UK said 2016 will continue to be a challenging year, despite UK Government data estimating oil and gas production rose by more than 7% in 2015.
Findings from the Office of National Statistics (ONS) found in the first 10 months of 2015, the total volume of oil and gas produced on the UKCS was up 8.6% compared with 2014.
Meanwhile production of liquids rose up 10.6% and gas by 6.1%.
Chief executive Deirdre Michie said: “Output in November and December tends historically to be more stable, but even so, Oil & Gas UK now expects year end production for the full year of 2015 to be seven to eight per cent higher than last year.”
“Given the difficulties being faced by the industry this is welcome news. In February 2015 we predicted a marginal increase in production for 2015, but the industry-wide focus on improving production efficiency coupled with investments of more than £50 billion over the last four years to bring new fields on stream across the last twelve months is paying off and yielding a better result.
“The upturn underlines the industry’s commitment to the UKCS – which still holds great promise for the future and is vital for the country’s security of supply.
“For example, only last week, oil company Taqa announced first production from the Cladhan field north-east of Shetland, estimated to produce 10,000 barrels of oil a day from the UK’s waters.”
The head of the industry body said the industry was still continuing to adapt to a “lower for longer” oil price and driving forward greater efficiencies.
Michie said times continued to be tough for the industry and those working in it.
She added:“As we go through these times, we have to be resilient and focus on what we need to do to get us through the coming months to ensure an enduring industry for the future.
“Even in these challenging times – we continue to have a supply chain that is the envy of the rest of the world as a centre of excellence for offshore technologies. The supply chain generates tens of billions of pounds in domestic and export sales.”
SNP energy spokesman Callum McCaig said: “These are extremely encouraging production figures for our North Sea oil and gas industry – which is showing resilience in the face of global challenges.
“Industry-led initiatives to increase production efficiency are reaping positive results; however dithering from the Tory government in incentivising exploration and development of new prospects is still a serious concern. In fact, it is an approach which shows utter disdain for an industry under pressure.
“Today I am calling on George Osborne to set himself a New Year’s resolution – 2016 must be a year of action from the UK government.
It’s high time the Chancellor heeded the SNP’s longstanding call to introduce exploration incentives in the North Sea, to protect jobs and sustain a vital industry.”
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