#SONews – North Sea must reduce the time it takes to bring new discoveries to development
Operators in the North Sea need to reduce the current 30-year time duration from discovery to final investment decisions, according to a new report by the Oil and Gas Authority.
Final Investment Decisions (FIDs), the average time between offshore oil and gas being discovered and projects reaching sanction, is 25 years. With the addition of three years, the time between FID and the first production.
Pace of discoveries should increase as 75% of new developments from now are projected to be smaller and linked to already existing infrastructure. However, the number of existing infrastructure that new developments could be linked to is reducing as more fields stop production.
Last year, the second phase of BP’s West Shetland Development was the only major project to reach production last year, the field was first discovered in 1977.
The Oil and Gas industry needs to focus on delivering projects to the level required by FIDs efficiently and as quickly as possible to allow the UK Continental Shelf to make the most of existing infrastructure.
Findings for 2018 showed that 60% of projects were delivered on time, compared with 25% in the 2017 period. The OGA said the next two years’ project delivery is likely to remain at similar levels but activity is expected to drop in 2021.