Sir Ian Wood, Proposals Provide Catalyst for Maximising UK Oil and Gas Recovery says Oil & Gas UK
Oil & Gas UK welcomes the interim recommendations announced today (11 November 2013) by Sir Ian Wood, who was commissioned by DECC in June to conduct an independently led review of oil and gas activity on the UK Continental Shelf (UKCS) and its regulation.
Sir Ian Wood’s new strategy, Maximising Economic Recovery for the UK (MER UK), proposes more rigorous stewardship of the UK’s remaining oil and gas resource through greater collaboration between operators and strong tripartite co-operation between DECC, HM Treasury and the industry.
Malcolm Webb, Chief Executive, Oil & Gas UK Commented:
“The UKCS is a highly competitive environment, with a record £13.5 billion being invested in 2013. Yet the industry has changed considerably over the past twenty years. It is much more complex, with the range of companies active in the North Sea growing in diversity. The number of fields in operation has climbed from 90 to over 300 since the 1990s while the average size of new discoveries and daily production rates are falling.
“This is a changing landscape but the challenge remains constant – how to maximise economic recovery of the UK’s remaining oil and gas resource.
“It is clear from today’s record investment that there is an appetite to do business here in the UK. The industry made it clear in its response to Sir Ian Wood’s consultation that there is also an appetite to examine how we do business here and recognition of the need for a fundamental change of approach if we are to secure the next phase of offshore oil and gas development in the UK.
“A new level of collaboration will be required. The catalyst for that will be the proposed arm’s length regulatory body to take on the stewardship role for this new era. We welcome this proposal as an opportunity to build on the existing regulatory regime and take it to a new level. The creation of a well-resourced arm’s length Regulator will, we believe, provide the single-minded focus required to deliver the maximum economic benefit for the industry and the country in this critical next phase of the UKCS’ life.
“But there is no time for delay. To maintain high investment in this basin and prevent premature decommissioning of infrastructure, the Government needs to move swiftly ahead with these proposals. Oil & Gas UK looks forward to the publication of the final report early next year and the opportunity to work with Industry and the Government to put these recommendations in place.