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Supply Chain
• Revenues across the supply chain are forecast to fall by around 21 per cent this year, taking market revenue
below £30 billion for the first time since 2010. This follows a contraction of around 10 per cent in 2015.
• Supply chain EBITDA
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is forecast to have fallen by almost half over the last two years, reflecting reduced activity
levels and the cost of reorganisation.
• Companies specialising in wells or reservoir-based activities appear to have suffered the most, with revenues
expected to decline, on average, by 53 per cent and 48 per cent respectively from 2014 to 2016.
• The facilities segment, representing around one-third of the total supply chain, has seenmore robust performance
to date with revenues increasing by around 7 per cent in 2015. However, concerns over future activity mean
revenues in this segment are forecast to contract by almost one-quarter this year.
• Revenues in the marine and subsea segment are thought to have fallen by 14 per cent in 2015 with a further
decrease of 11 per cent expected in 2016 to £8.4 billion. However, EBITDA margins are likely to remain higher
than other areas of the supply chain at 12 to 13 per cent due to a number of ongoing large-scale subsea projects,
such as Schiehallion, Greater Laggan and Kraken.
• Revenues in the support and services segment of the supply chain, comprising a wide range of businesses, are
forecast to contract by 13 per cent in 2016, similar to the 14 per cent fall last year.
Employment
• Across the UK, around 330,000 jobs are currently supported by the offshore oil and gas industry:
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34,000 direct employees
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151,500 indirect employees
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144,900 induced employees
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• This represents a 27 per cent reduction from peak employment of around 450,000 in 2014.
Upstream Production Taxes
• Over £330 billion has been paid in corporate taxes since production on the UKCS began.
• Production taxes fell to just beneath zero in 2015-16
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, reflecting a lack of profitability and increasing
decommissioning expenditure.
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Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA).
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Those employed by companies operating in the extraction of oil and gas and associated services.
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Employment as a result of supply chain effects caused by oil and gas sector activity. For these companies,
extraction of oil and gas and associated services will be one part of a wider business.
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Employment supported by the redistribution of income from the oil and gas sector.
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See
http://bit.ly/2ckwOyL