Wednesday November 23, 2005

UK oil output : running on empty?

news.bbc.co.uk :

British North Sea oil output has declined steadily since 1999. The UK produced an average of 2.72 million barrels a day (mbpd) in 1999, hitting a high of 3.1 mbpd in August. But by June 2005 this had fallen to 1.7 mbpd, a drop of 34%.

In 2000, production was down 8.1% from its 1999 high, then falling 6.8% in 2001. 2003 saw an 8.8% decline, rising to 10% in 2004. This year has seen a similarly startling decline. In February, year-on-year levels were down 13%, rising to 17% in March. "These declines do seem to be irreversible now," says Deborah White, senior energy analyst at Societe Generale.

Declining oil output has a direct economic impact upon British citizens through lower tax revenues. Average oil production fell by 940,000 barrels between 1999 and 2005. Assuming an average oil price of $60 a barrel and using some back of the envelope calculations, that would work out at ?33.82 per barrel. In this scenario, the UK would lose an average of ?31.7m a day, equivalent to ?11.6bn a year.

See also :

1. Peak Oil - The pressure mounts
2. British economic growth rate slumps to 12-year low
3. North Sea oil declined 17% (!!)
4. "North Sea production ... peaked in 1999"

(2005-11-23 17:25:20 SGT) [Energy] Permalink

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