HOUSTON --Prospective new entrants into UK North Sea development may have to think twice about it due to restrictive decommissioning requirements and other roadblocks, according to a new survey published by the Aberdeen & Grampian Chamber of Commerce.
Access to funding by independent oil and gas companies also may affect the number and quality of new entrants into the UK continental shelf.
The survey, sponsored by the law firm McGrigors and conducted by the Fraser of Allender Institute of Strathclyde University, is the 12th such review conducted by chamber and draws on responses from oil and gas operators and service contractors to identify trends including activity levels, skills supply and contractual matters, investment, and new market development.
More than half of survey respondents said the range of support services, access to the latest technologies and range and depth of professional/technical services was generally excellent. Also highlighted as an international strength was the industry leading subsea technology being developed in Aberdeen City and Shire, as well as logistics and supply chain excellence. However, these advantages were diluted by “poor prospects,” an aging infrastructure, costs and lack of investment and activity, along with current UK fiscal policies.
The survey, available on the chamber’s website at www.agcc.co.uk, indicates recent tax changes and allowances are insufficient and more needs to be done in terms of changing the tax regime and in capital allowances if the recovery of UKCS reserves is the maximized.