Upstream boom likely to frustrate North Sea investment opportunities

Established UK oil and gas consultancy Hannon Westwood* has just published its forecast for the UK offshore sector in 2007 in which it predicts lack of available equipment and resources could frustrate those companies hoping for a quick turnaround in their investments in North Sea prospects. When we look at the UKCS over the past three years or so, we can see a new story unfolding, with large scale acreage releases by the DTI, the doubling in the number of acreage owners, and the creation of well activity unseen since the early 1990s, all taking place within an environment of a worldwide increase in rig rates and the tightening of rig supply. In addition, we are seeing the emergence in the UK of new forms of longer-term finance for smaller or independent companies.