North Sea is running too dry to meet target

The energy industry warned yesterday that government targets of keeping Britain’s oil and gas production at 3m barrels a day by 2010 look like being missed. North Sea competitiveness is falling and financial backers are losing confidence in the wake of tax increases introduced 18 months ago.

Civil servants have been working with oil companies to find ways to boost output offshore, but the 2007 Economic Report issued by the industry organisation Oil & Gas UK says the goal looks like being missed after five years of rising hopes.


“This shift is indicative of reduced confidence among investors – it now looks as though only 2.6m barrels of oil equivalents will be produced every day in 2010,” argues the report, increasing fears that the UK would become dependent on Russian and other foreign gas imports.

The UK pumped 2.9m barrels a day of oil and gas on average during 2006, 9% lower than the year before despite a major increase in investment to