Piping up for North Sea oil

With the oil industry enjoying the fruits of a boom, you might expect the man who represents the North Sea oil and gas industry to feel rather satisfied. But when Malcolm Webb, the chief executive of the UK Offshore Operators Association (UKOOA), addressed investors and analysts in the City last Wednesday, his message was rather more sombre.

Falling investment levels, high taxes and rising costs threaten the viability of an oil-producing region which is just over halfway through its expected lifetime.

Webb has the tough task of representing an industry which is raking in record profits around the world, but which is facing mounting problems in the UK.
While oil may not be the most environmentally friendly fuel, the UK still consumes huge quantities and the only alternative to producing it here is to transport it thousands of miles from some of the world’s most politically unstable regions.

The danger is that oil companies will start to move platforms and pipelines out to more promising areas, reducing the UK’s future security of supply. “There are between 25 billion and 27 billion barrels left under the North Sea, but we need continued investment to get it out and we do not want to see it go prematurely,” says Webb.

Scotsman