With suggestions that the worst of the oil slump is over, it has been reported that 30 North Sea projects are expected to start over the next three years, with 20 in UK waters.
Hurricane Energy claims to have made a major find of around 1 billion barrels of oil in the West of Shetland area. This area contains almost a third of sanctioned reserves and a quarter of potential new reserves. Both Shell and BP have been awarded exploration licenses in nearby blocks recently and other independent operators with an interest in the area include Apache and Premier.
The Oil and Gas Authority also estimates up to 3 billion barrels of oil may lie in ‘small pools’ of less than 50mboe (million barrels of oil equivalent). Another factor feeding into the economics of oil and gas development is better collaboration between operators and the supply chain, bringing costs down by around 40% and creating interest in projects even at $50 a barrel.