Business Outlook 2020 - Autumn Snapshot
BUSINESS OUTLOOK 2020: Autumn Snapshot
Recovering Investment and Activity Levels continued
12,000
It is key that the UK industry remains competitve to retain and attract investment in the face of increased international competition for a restricted capital pool. Whilst the UKCS continues to be a relatively expensive basin in terms of operating costs, recent improvements (a reduction from over $30 per barrel of oil equivalent [boe] to $15/boe in unit operating costs) have helped and it is important these are maintained. Alongside this, it is important that the government reinforces the triple importance of the domestic oil and gas industry and its crucial role in supporting the wider decarbonisation of the UK economy. It is vital that this is emphasised in the forthcoming Energy White Paper, the Licensing and MER strategy review and that the competitveness and stability of the fiscal regime is maintained. It is also crucial that companies are able to continue to safely increase offshore personnel levels to allow more offshore activities to be completed. The number of personnel working offshore at any one time fell by over 40 per cent between March and April as companies reduced activities and looked to minimise personnel exposure risk as far as safely possible. Although offshore numbers have increased in recent months, staffing levels have not yet reached those seen prior to the pandemic. Looking to 2021, 40 per cent of E&P companies and half of supply chain companies have indicated that more than one-third of their 2021 plans are contingent on being able of increase offshore personnel levels. It is important that activity levels on the UKCS keep pace with those in other basins to ensure that it remains a competitive place for supply chain companies to anchor and invest in resources. These capabilities are crucial to maximise the UK’s resource potential, but also will have a vital role in providing the solutions required to achieve a net zero outcome by 2050.
11,000
10,000
9,000
8,000
7,000 Number of People Offshore
6,000
5,000
05-Jul
12-Jul
19-Jul
26-Jul
07-Jun
14-Jun
21-Jun
28-Jun
05-Apr
12-Apr
19-Apr
26-Apr
30-Aug Source:VantagePOB 06-Sep 13-Sep
20-Sep
27-Sep
02-Aug
09-Aug
16-Aug
23-Aug
01-Mar
08-Mar
15-Mar
22-Mar
29-Mar
03-May
10-May
17-May
24-May
31-May
10
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