OIL and gas production in the UK North Sea is set to dwindle to next to nothing by 2050, according to analysts who have said hopes of a revival have been extinguished following recent reverses west of Shetland.
Rystad Energy noted that Hurricane Energy had generated huge excitement about an under-explored geological zone west of Shetland, which it was hoped could contain billions of barrels.
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It was thought production from the fractured basement zone targeted by Hurricane would be sufficient to increase total output in the North Sea to more than two million barrels oil equivalent per day (boepd) following years of steep decline
However, Hurricane recently slashed estimates of the size of finds it has made after facing complications on the flagship Lancaster field.
“Promising exploration results by Hurricane Energy in fractured basement reservoirs, previously untapped in the UK, were until earlier this year expected to revive the country’s output to 2.1 million boepd by 2035,” said Rystad. “Now those hopes have been dashed.”
Describing a recent downgrade of Hurricane’s Lancaster field as “jaw-dropping”, the consultancy added: “This is a major blow to the outlook for the UK’s future petroleum production, as fractured basement resources were estimated to account for nearly one-fifth of the future oil and gas output from the United Kingdom Continental Shelf.”
Rystad predicted that UKCS production will never again exceed two million boepd. It will reach a maximum of 1.7 million boepd in 2035 before “dwindling to nearly nothing by the middle of the century”.
The plunge in commodity prices triggered by the coronavirus crisis has prompted firms to slash investment in the North Sea. Exploration activity had fallen to record lows before the latest downturn started.
Output peaked at 4.3 million boepd in 1999. It averaged 1.65 million boepd last year.
