WIRELINE ISSUE 27 SPRING 2014

NEWS ROUND-UP

OIL&GASUK

4.WOODREVIEWRELEASESFINALREPORTON MAXIMISINGECONOMICRECOVERY

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On24February, Sir IanWoodpublished the findings of his independently-led review into theUKContinental Shelf (UKCS).Energy secretaryEdwardDaveyMPhad commissioned the review in June2013.The central recommendation is for anew strategy, MaximisingEconomicRecovery from theUKCS (MERUK),which calls formore rigorous stewardshipof theUK’s remainingoil andgas resource through the creationof anew arm’s lengthgovernment regulatorwith additional powers and resources; strong tripartite co-operationbetween the regulator,HMTreasury and the industry; andgreater collaborationbetween theoil andgas production companies (seep25 for aQ&Awith Sir IanWoodon thedetails of his recommendations). Oil&GasUKwelcomes the final report. “This is a seminalmoment in thehistoryof theUKCS.The report is agame changer,” saysMalcolmWebb,Oil&GasUK’s chief executive. “We see this as thenecessary catalyst for change, ensuring that the stewardship of the country’s oil andgas resource is taken to anew level.Thenew tripartite approach is key and crucially important.”

6. SUCCESSFULEXPLORERS SHARESOLUTIONSTO PITFALLS On4February, over150people attended thePitfalls of ExplorationConference, organisedbyOil&GasUK inpartnership with thePetroleumExplorationSociety ofGreatBritain.Theone-day conference focusedonkey lessons fromexploration on theUKContinental Shelf (UKCS)with aview toboosting further success across the sector.Theevent reflects theurgent need to increaseexploration activity.Data releasedby theDepartment of Energy& ClimateChange andpresented in Oil&GasUK’s Activity Survey2014 (see story left) clearly illustrate theparlous stateof explorationon theUKCS. Seep28 for informationon the ExplorationTaskForce, part of the government-industry forumPILOT.

For the full report, pleasevisitwww.woodreview.co.ukand seep25 foraQ&Awith Sir IanWood.

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5.ACTIVITYSURVEY2014HITSTHEROAD Nearly700delegates heard first-hand the latest forecasts for theUKoffshoreoil andgas industry at a series of events held from26 to28February.Oil&GasUK took to the roadwith its newly released Activity Survey2014 , holdingbriefings inAberdeen,London, Newcastle andNorwich. The report, publishedon25February, highlights the contradictions currently at play in the industry. Following an all-time recordof £14.4billion capital investment on the UKContinental Shelf (UKCS) in2013, the report predicts capital expenditureof around £13billion in2014, the secondhighest yearon record. It alsopoints tobetter than expectedproduction last yearwith an averageof 1.43millionbarrels of oil equivalent perday; production is alsoexpected topickup further in2014.This contrastswith exploration.Only15explorationwellsweredrilled in2013 andexplorationover the past threeyears has been at its lowest in thehistoryof theUKCS.Meanwhile, operating expenditure roseby15.5per cent to a recordof £8.9billion in2013 and is anticipated to rise further this year. Oil&GasUK’s chief executiveMalcolmWebb says: “It is crucial to address rising costs and improveour capital efficiency.However,without greatly increasedexploration success, the conversionofmorediscoveries intoproduction, a significant improvement in productivity and thedeployment of enhancedoil recovery,wewill not realise thebasin’s full potential. It is in this context thatwe fully support the timely recommendationsmade bySir IanWood (see story above).” The full report isavailable todownloadatwww.oilandgasuk.co.uk/forecasts.cfm. Seep22of this issue fora summaryof thekey factsandfigures in thereport. Oil&GasUK staffpresentedatvariousevents across theUK to launch the ActivitySurvey2014 .ChloeSmithMP forNorwichNorth (see second left), and former economic secretary to theTreasury, attended the lunchbriefing inherconstituency

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SimonTooleof theDepartment of Energy&ClimateChangegave the keynote address at thePitfalls of Exploration conferenceon4February inLondon

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THE MAGAZ I NE FOR THE UK OF F SHOR E O I L AND GA S I NDUS TRY