UK North Sea threatened by cost escalation

The oil price fall points a spotlight on the UK’s out-of-control operating costs

In 2009, Brent Blend crude was selling for an average price of $61.46 a barrel and the UK’s North Sea oil and gas were costing $13.20 a barrel of oil-equivalent (boe) to produce. Move forward six years and the Brent Blend price is much the same - but the operating cost has escalated to $30.53/boe, according to the producers’ and suppliers’ association, Oil & Gas UK (OGUK).  "Inadequate stewardship coupled with an unstable fiscal regime and a steep production decline have made the UK continental shelf, on a unit of production basis, one of the least competitive places to operate in the world”, according to OGUK’s chief executive, Malcolm Webb. The organisation’s Activity Survey 2015, publ