Feb. 24
Britain's North Sea oil industry will see fundamental change through the implementation of a series of measures recommended in a government-commissioned report.
Between US $320 billion and $480 billion of new investment could be realized in the next 20 years, and between 3 Bbbl and 4 Bbbl of extra oil could be recovered by following suggestions laid out in a new industry report by Sir Ian Wood, the UK government said.
In a newly finalized report that has put the operation of the UK's North Sea industry under close scrutiny, Wood suggested a new tripartite strategy for maximizing economic recovery (MER) from the UK North Sea involving the UK Treasury, a proposed new industry regulator, and the oil and gas industry.
Wood is advocating the creation of a new “arms' length” regulatory body to oversee industry changes and to encourage greater collaborations between operators.
This new regulator will have responsibility for licensing, stewardship of offshore assets, and industry supervision. It will be “low in bureaucracy but high in skills and experience,” as well as being “strong and pragmatic.”
Wood's final report also detailed sector strategies designed to achieve MER from the UK's offshore resources, covering exploration, asset stewardship, regional development, infrastructure, technology, and decommissioning.
Energy Secretary Ed Davey already has pledged to immediately implement Wood’s suggestions. Davey commissioned the veteran industry expert and former chairman and CEO of the Wood Group to investigate the state of the UK offshore industry in June 2013 with a remit to suggest changes to improve oil and gas recovery.
The report comes as UK offshore oil and gas production has fallen 40% in the last three years, according to the government, while oil and gas production efficiency has fallen to 60%, costing the economy $9.6 billion in lost revenue.
Source: http://www.epmag.com/Technology-Regulations/Wood-Review-Calls-New-Oil-Industry-Regulator_129526?
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