Oil & Gas Division Update - July 2015

Oil & Gas Division
,
24 Jul 2015

Review of World Energy

At the beginning of June British Petroleum published the 64th issue of the highly regarded statistical review of world energy. Anyone can access the review from www.bp.com The review covers all forms of energy and includes data on carbon emissions. The website provides comprehensive data along with video clips, trending tools, country and regional insights. The review clearly illustrates the transformational period that global energy is going through. Off the back of onshore shale gas and oil the United States has overtaken Saudi Arabia as the largest oil producer in the world and has overtaken Russia as the largest global producer of oil and gas. The supply of energy and chemical plant feedstock has galvanized the US economy, little wonder that the UK Government seeks to develop the potentially extensive shale oil and gas resources of the UK. Studies have indicated that the development of onshore UK shale gas could support up to 10,000 wells, with 100 rigs working and a second oil centre equivalent to Aberdeen. The supply of large volumes of gas could be transformational for UK manufacturing with high volume feedstock for UK chemical plans such as Grangemouth. While demand for energy has continued to increase the rate of increase has slowed, the energy mix is changing and the flow of energy is shifting with the US no longer needing to import large volumes. Led by Saudi Arabia the response from OPEC has been to increase production to protect market share. This has resulted in a sustained drop in oil and gas prices which has significantly impacted higher cost producers such as the UK. As highlighted in the last newsletter the UK oil and gas sector continues to adjust to current market conditions. Costs are coming down, taxes have been reduced and ongoing major projects are keeping the Industry busy.

UK Oil and Gas Authority

The new Oil and Gas Authority is continuing to staff up and is due to submit a strategy for maximizing economic recovery from the UKCS to Parliament in the Autumn.

Oil and Gas Division Activities

In times of reduced oil and gas prices it is important to not lose focus on process safety and personnel competence. These are key areas where the Institute has a significant role. In May CNOOC Nexen hosted a Division seminar covering plant integrity, well integrity and UK legislative requirements. The seminar was well received and the Division is planning to hold another seminar in 2016 covering UK shale gas and oil. For the start of the new academic year the Division has scheduled a range of technical seminars for Fife College, St. Andrews, The Robert Gordon, Heriot Watt and Aberdeen Universities to provide students with information on the latest developments in Industry. The new Institute website has gone live and concurrent with this the Division has published the first of a series of overviews of key aspects of the Oil and Gas Industry. The first overview covers well servicing techniques. This overview and all the latest Division information can be found on the Division microsite at www.iom3.org In recognition of significant contribution to the UK Oil and gas Industry the Institute is to award Oil and Gas UK the Institute Medal of Excellence at the annual awards dinner this July. I would commend the website www.oilandgasuk.co.uk as a very useful source of information on the UK Oil and Gas Industry.


Steve Bedford
Oil and Gas Division