Business Outlook 2019

BUSINESS OUTLOOK 2019

4.2 Drilling Activity In total, 102 wells were drilled on the UKCS in 2018 (85 development, eight exploration and nine appraisal). Although this represents a slight increase from 96 wells in 2017, well construction activity — key to progressing resources to production — remains among record-low levels. This is largely the result of only the most valuable work programmes being progressed amid continued capital discipline and reduced investor risk. Despite this, there is optimism that there could be further improvements in 2019, with some increases possible across all types of drilling activity. It is hoped that this signals a stabilisation in terms of resource progression activity, and the beginning of a steady recovery. However, it should be acknowledged that these improvements remain somewhat uncertain, with companies closely monitoring market conditions and adjusting their strategies to match. Many of the opportunities within E&P portfolios are relatively small, a reflection of the maturity of the UKCS and the increased diversity of ownership. It is important that companies continue to work collaboratively to create scale within and across portfolios to improve the chances of resource progression opportunities being realised.

Figure 9: Total UKCS Drilling and Well Decommissioning Activity 6

450

Exploration Appraisal

Development

Decommissioned

400

350

300

250

200

150

100

50

Total Number of Wells Drilled and Decommissioned

0

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016 Source: OGA

2018

6 Note that well decommissioning data is only available from 2010.

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