Sir Ian Wood to carry out review of oil & gas sector
11 Jun 2013
DECC has announced a review of the oil & gas industry- the first of its kind for two decades.
The UK Department of Energy and Climate Change (DECC) is to carry out an independent review of the offshore oil & gas industry.
Retired businessman, Sir Ian Wood, will lead the review which is the first of its kind for two decades.
Energy secretary Ed Davey said the oil & gas sector faces “unprecedented challenges that require new thinking.”
Challenges include declining exploration and production rates, ageing infrastructure and declining production efficiency alongside the risk of premature decommissioning of key infrastructure.
Davey added that while more than 40 billion barrels of oil and gas have already been produced from the shelf, there is still a significant amount to be exploited.
“I have come to the view that the challenges we now face are of sufficient importance that they merit a focused, in-depth review,” said Davey.
“Such a review has not been conducted since the early 1990s when the challenges faced were very different to those we face now.”
Wood said: “The values involved in UK oil and gas are so large that even modest increases in key production metrics over time will deliver significant economic benefits.”
Wood retired as chairman of Aberdeen-based oil services firm Wood Group last year.
Trade body Oil & Gas UK’s chief executive Malcolm Webb highlighted the importance of oil & gas to Britain’s security, economy and innovation.
“In overcoming the challenges of producing oil and gas in a mature province and in ensuring the basin’s full potential is realised, collaboration between companies in the sector and a well-resourced and expert regulator is crucial so we welcome the launch of this review,” he said.
Wood is not expected to change the tax regime for the industry as there were a number of changes in 2011.
But Davey said the review’s recommendations will be considered when the Treasury makes further policy decisions.
