Exploration for oil and gas in the North Sea has all but ground to a halt as low oil prices take their toll on companies, according to a report published on Tuesday by the industry trade body.
Oil and Gas UK predicts companies could drill as few as seven exploration wells this year — fewer than at any time since it started collecting the data in the late 1970s. That would compare with 13 last year and 40 in 2008.
The report shows that as the price of oil has collapsed from $115 a barrel in 2014 to about $35 now, the first casualty has been spending on new discoveries. Industry figures are warning that, unless activity picks up soon, billions of barrels of oil could be lost completely, left in the seabed without the infrastructure or skills to get it out.
Deirdre Michie, chief executive of Oil and Gas UK, said: “Activity is effectively drying up. Companies’ current plans mean recovering 6.3bn barrels of oil equivalent but, after that, there is a significant gap.”