Economic Report 2013

As well as the rate of technical change and oil and gas prices, government policy, particularly fiscal policy, has also affected the pace of development. Figure 6 shows how industry and government are working together, under the auspices of the task force, PILOT. The overall intention is to ensure that the right policies are in place and are being implemented to achieve maximum economic recovery of oil and gas from the UKCS. For more information about PILOT and its work, please refer to the sub-section below entitled ‘The Road to 2040’.

highly skilled and paid jobs, and more than £300 billion (in 2012 money) to the Exchequer in production taxes over the past 45 years. During this period, 42 billion boe of oil and gas have been produced, but there is still a significant resource of some 15 to 24 billion boe left to be developed. This will require further exploration activity and increased investment, in both existing and new fields. About 7.4 billion boe should be produced from existing fields and new projects that have already been sanctioned. This can be seen as the lowest likely figure for reserves, that is the oil and gas which have a greater than 90 per cent chance of being recovered. In reality, it is highly likely that there will be further investment on theUKCS and, therefore, more reserves recovered.

Remaining Resources and Reserves

Oil and gas extraction from the UKCS has provided the economy with energy supplies,

Figure 6: Policies to Increase Recoverable Resources

Aim

Policy

Work Group

Oil & Gas UK Economic & Fiscal Forum

Increase Reserves Discovered

Small Field Allowance

PILOT Exploration Task Force

Oil & Gas UK Economic & Fiscal Forum

Increase Recovery from Existing Assets

Brown Field Allowance

PILOT IOR and EOR Work Groups

Commercialisation of Marginal Discoveries

All Field Allowances

Oil & Gas UK Economic & Fiscal Forum

Infrastructure Code of Practice (ICoP)

Extending the Life of Infrastructure

PILOT Infrastructure Access Group

Increase Production Efficiency

Asset Stewardship

PILOT Production Efficiency Task Force

Promoting Investment and Postponing Decommissioning

Fiscal Certainty on Decommissioning Relief

Oil & Gas UK Economic & Fiscal Forum

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ECONOMIC REPORT 2013