MORE than 10 billion barrels of oil remain in the North Sea and current production will be sustained for at least two decades, according to a new report.
The UK still has “significant petroleum reserves” which will last at least 20 years even if no new fields are discovered, said The Oil & Gas Authority (OGA) It estimates the overall remaining recoverable reserves and resources range between 10 to 20 billion barrels of oil equivalent (BOE).
The body said there are approximately 5.7 billion BOE of proven reserves which based on current production forecasts has the capacity to sustain production for at least the next two decades.
Production could go on even longer if additional undeveloped resources can be matured, the UK Oil and Gas: Reserves and Resources Report said.
The OGA estimates there are 7.4 billion BOE of discovered undeveloped resources, much of which is in mature developed areas and under consideration for development.
The maturation of contingent resources - those which are not yet considered mature enough for commercial development - presents “significant opportunity for the continued development of the UK’s petroleum resources”.
However, this will require “substantial investment in new field developments and incremental projects”, the report said.
Four new discoveries from exploration successes in 2016 added 210 million BOE to the contingent resource base.
The report also estimates there are six billion BOE of undiscovered resources, ranging from a lower estimate of 1.9 billion BOE to an upper estimate of 9.2 billion BOE.
The OGA’s operations director Gunther Newcombe described the UK’s waters as “world-class petroleum province with 10 to 20 billion barrels of remaining discovered and undiscovered potential.”
He added: “The OGA has an important role in helping to steward this resource base, revitalise exploration and maximise economic recovery, working closely with industry and government.
“Future success of the basin requires attracting additional investment, implementing technology and company collaboration on new and existing developments.”
But the report warns that the replacement of proven and probable reserves remains a concern in the industry and around £9billion will need to be invested to keep production even at current levels.
Approximately 600 million BOE were produced but only 80 million BOE of contingent resources were matured to become reserves that can be recovered.
To achieve a reserve replacement ratio of 25per cent over the next five years at an average unit development cost of £12 per BOE the industry will have to invest £9billion.
The report comes after academics recently warned that North Sea oil and gas production will cease within a decade.
They say their research has revealed that just 11 per cent of the UK’s oil reserves, equivalent to 3.3 billion barrels, has still to be recovered and it will run out by 2027.
The Edinburgh University study warned the UK will soon have to import all the oil and gas it requires and will leave the country facing an unprecedented energy crisis.
Around 43 billion barrels have so far been extracted from the North Sea, while investment in the sector reached a record high last year of more than £14 billion.
Industry estimates suggest there are up to 24 billion barrels remaining.
Professor Alexander Kemp, professor of Petroleum Economics and Director of Aberdeen Centre for Research in Energy Economics insists even at the current low oil price there were still around 11 billion barrels left “which can be recovered profitably”.
Industry body Oil and Gas UK said “there are up to 20 billion barrels of oil and gas resources still to be recovered on the UK Continental Shelf”.
It also predicted “some notably large developments will still be producing towards 2050”.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article