Lloyds List: North Sea oil output slumped to 14-year low in September: “New projects that have come on line this year, including Shell's Goldeneye gas-condensate project and the imminent start-up of BP's Clair project should reduce the rate of overall decline in 2005.” (ShellNews.net) 17 Dec 04
Martyn Wingrove
Dec 17, 2004
BRITISH oil production slumped to its lowest level in almost 14 years in September as a combination of platform maintenance programmes, natural field declines and emergency closures pushed output down to 1.53m barrels per day.
According to figures from the Royal Bank of Scotland, oil output fell 22% year-on-year and 5.5% on the month in September. Natural gas output was also down 5.5% compared with September in 2003 to 9bn cu ft per day.
Closure of North Sea platforms, including Shell's Dunlin, which is also a hub for Canadian Natural Resources' Murchison and Lundin's Thistle platforms, resulted in a loss of throughput to the Sullom Voe terminal.
Production has since been ramped up in the UK North Sea as these platforms have come back on line, so total UK production has risen from this low level.
Norwegian output was at around 2.9m barrels per day in September and October, but has fallen since because of a gas leak on Statoil's Snorre Alpha platform.
Combined oil and gas production in September was 3.12m barrels of oil equivalent per day, down 14.5% year on year.
'North Sea oil production fell to its lowest level since May 1991 in September,' said Tony Wood, senior economist with the Royal Bank of Scotland in its report. 'However, revenues continue to be held up by high oil prices.'
These outages and lower overall North Sea production put pressure on oil markets during September and the fourth quarter of this year. It also resulted in lower demand for tankers operating out of terminals, including Shetlands' Sullom Voe.
Despite renewed interest and investment in the UK sector, production levels are set to continue to decline, but at a more stable level.
New projects that have come on line this year, including Shell's Goldeneye gas-condensate project and the imminent start-up of BP's Clair project should reduce the rate of overall decline in 2005.