Scottish Enterprise sees U.K. offshore exploration and development programs (18739 bytes) growing faster than those in the rest of the world during the next 5 years.
Total spending by the U.K. offshore industry is expected to peak at 9.3 billion ($13.95 billion) in 1999, rising from 8.3 billion ($12.45 billion) last year.
Scottish Enterprise attributes the rising outlay mainly to several new field developments, particularly in the central North Sea.
However, the Aberdeen agency said exploration and appraisal (E&A) drilling will not return to the banner years of 1990 and 1991, when more than 200 wells were drilled off the U.K.
During the next 5 years, the number of E&A wells will increase modestly to about 100/year from only 86 in 1994.
Between 1995 and 1999, said Scottish Enterprise, 22 new northern North Sea and 47 central North Sea fields will go on stream. In the southern gas basin, during the same period, 28 new fields will begin producing.
Also, three fields west of the Shetland Islands will start producing, as well as four new fields in the U.K. Irish Sea.
Breakout of spending
U.K. E&A spending will remain steady at about 1.2-1.3 billion ($1.8-1.95 billion)/year during the forecast period.
U.K. operating expenditures will fall from last year's 3.4 billion ($5.1 billion) to a low of 3.2 billion ($4.8 billion) in 1996.
Scottish Enterprise said, "After 1997, as new developments come on stream, operating expenditures are anticipated to increase gradually to 3.5 billion ($5.25 billion) in 1998 and 3.7 billion ($5.55 billion) in 1999."
U.K. development spending will rise modestly during the 5 year period, from 3.9 billion ($5.85 billion) in 1995 to 4.2 billion ($6.3 billion) in 1999.
"We see a very strong, buoyant economy in the U.K. oil and gas sector during the next 5 years," said Kourosh Bassiti, head of the energy group at Scottish Enterprise, "and hopefully for the next 10 years.
"This reasonably bullish forecast is possible only because U.K. operators are seeing the benefits of their Cost Reduction Initiative for the New Era (Crine) program after some initial pain."
Worldwide oil and gas spending will increase from 119 billion ($178.5 billion) in 1994 to 128 billion ($192 billion) in 1999.
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