Investment needed in UK oil and gas

The UK still offers significant opportunity for offshore oil-and-gas development but companies are finding it difficult to turn new reserves into economic production, according to industry body Oil & Gas UK. The organization has published its annual forecast of offshore oil-and-gas exploration and development activity in the UK, based on a survey of the spending plans of more than 70 companies. It shows that the number of offshore oil-and-gas projects currently under consideration for development has risen over the past 12 months. Business plans developed over the latter half of 2009 have identified up to 11 billion barrels of oil and gas in new and existing projects, a 15 per cent increase over 2008 and requiring total capital expenditure of £60bn. Provided this investment can be secured, the industry could still be delivering 1.5 million barrels of oil and gas per day in 2020, which is claimed to be enough to satisfy half of total UK demand.