North Sea work surges on high prices
The main North Sea countries are seeing strong exploration and development activity, driven by high oil and gas prices and improved investment terms, Martin Quinlan writes
THE North Sea is a busy oil and gas province. For two years, oil and gas prices have been high and relatively stable, while explorers have had their interest sharpened by licensing offers in the UK and Norway. In the UK, investment confidence has been lifted by last year’s tax incentives; in Norway, recent large discoveries are the attraction.
But – as seen in the past – high activity levels can soon strain the North Sea area’s capacities in construction and oil services. In the UK, the producers’ and suppliers’ organisation, Oil & Gas UK (OGUK), says there are concerns about “shortages of skilled personnel, wage inflation and a general escalation of operation costs”. In Norway, the Norwegian Petroleum Directorate (NPD) says there are “capacity challenges” for operators and suppliers, with availability of drilling rigs and flotels being particular bottlenecks.
The clearest evidence of an upturn in...
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