North Sea rocked by price fall as production costs double
Lower oil prices are re-shaping oil and gas operations in the North Sea — with UK waters seeing the most drastic changes
It was only six years ago that the UK’s Brent Blend crude, the North Sea’s main price-setting grade, was last selling at today’s figure of about $60 a barrel. But much has changed in that time: oil and gas production have declined sharply, maintenance requirements have increased, and the industry’s contractors have been bumping-up their charges. It now costs more than twice as much to produce a barrel of oil from UK waters than it did six years ago, and nearly twice as much per-barrel to bring a new field into production. After starting out as the world’s highest-cost oil province, and then maturing into a lower-cost area, the UK North Sea has once again become a costly place to produce oil.
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