Activity Survey 2015

ACTIVITY SURVEY 2015

Production Outlook Looking ahead to 2015, Oil & Gas UK anticipates that the 1.1 per cent production decline seen this year is likely to be almost entirely recovered and the UKCS should see its first annual production increase in 15 years to around 1.43 million boepd (523 million boe).

Figure 24: Forecast Production from 2014 to 2015

600

36

500

63

31

2015 Start-Ups

Existing Field Decline

2014 Start-Ups

400

523

519

2015 Forecast Production

2014 Production

300

200

Production (Million boe)

100

0

Source: Oil & Gas UK

There are two major components to this forecast – production from existing assets and production from new field start-ups. Output from fields that were already in production prior to 2014, the large majority of fields that represent ‘the base’, is expected to decline by around 12 per cent. This is a slight increase in the decline rate from last year as many fields advance through the later stages of production and anticipates a drop-off in brownfield investment as competition for limited investment funds intensifies. That loss of production will be offset by around 67 million boe from new fields, split equally between those that commenced production in 2014 and those expected to start in 2015. Whilst there is reasonable confidence in the output from 2014 start-ups, there is greater uncertainty around a further 15 fields scheduled to come onstream this year. If first production on these new start-ups is delayed, then the central forecast may not be realised. Our low case forecast for 2015, which accommodates significant project slippage for new start-ups, is 1.37 million boepd.

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