Scottish North Sea Industry Confident of Return to Peak Profitability

Report Underlines Resilience of Oil and Gas Sector
An overwhelming majority of senior executives in the oil and gas industry believe that the North Sea industry will return to peak levels of profitability within five years, according to a new expert report.

The report published by Pinsent Masons finds that 96% of executives surveyed believed that the UK’s continental shelf will be able to recover 'peak' price levels of profitability seen in the first half of 2014 – with 71% expecting this to happen within the next five years.

The study follows news earlier this month that oil and gas production in the UK continental shelf has risen for the first time in 15 years, with output up by seven per cent in the last year.

Today’s report also stated that the industry was ‘resilient’ and would be in ‘terrific shape’ when prices begin to recover.

Commenting, SNP MSP Mark McDonald said:

“This report underlines both the resilience of the North Sea sector and the confidence that industry has for the future.

“Although both industry and workers face considerable challenges at present, we should be mindful that we have a world-leading skilled workforce and businesses that are capable of adapting to new markets and new conditions.

“We have seen some very encouraging news since the turn of the year, with North Sea production up for the first time in 15 years – but we need to build on that to make sure the industry has a prosperous long-term future.

“The SNP has repeatedly called on the UK government to take sensible steps to support the North Sea industry – particulaly on incentivising exploration and development of new prospects.

“The UK government should listen to the confidence industry has in the future of the North Sea and make 2016 a year of action for oil and gas – instead of continuing to sit on their hands as jobs are at risk.”