The North Sea oil industry has grown exponentially since the discovery of the Forties field in 1970. The combined number of offshore oil and gas fields within the UK Continental Shelf (UKCS) has reached almost seven hundred, producing some 41 billion barrels to date. According the UK and Scottish Governments, some 24 billion barrels remain, 85% of which lie under Scottish waters. Oil production rose to peak at 2.5 million barrels per day (BOEPD) between 1983-87, reducing to under 2 million between 1989-91. 1998 saw an increase to almost 3 million BOEPD, before rising to nearly 4 million BOEPD by 2003, after which production declined annually to 1.54 million BOEPD in 2012. The 2013 prediction is for 1.2-1.4 million BOEPD.

A record investment of £13.5bn was made in 2013, and output is predicted to reach almost 2 million BOEPD by 2017. Importing oil is costly, especially in light of the volatility of global prices following the 2011 Saudi Arabian oil crisis and ongoing Middle Eastern unrest. The UK is therefore dependent on North Sea oil to maintain a stable supply, the cost of which can then be passed down to the consumer, says.

The UK Government is seeking to unlock the potential of Britain’s remaining offshore reserves and increase production to around 2 million BOEPD. Greater collaboration between oil companies is called for to reduce the rate of decline in the rate of oil exploration and the amount of oil being recovered, but with levels of investment increasing through renewed confidence among the major companies, the North Sea Oil industry is in excellent health. This promising situation has been achieved through the impact of tax relief on marginal fields and decommissioning of mature fields, allowing the UKCS to remain internationally competitive.

Oil companies continue to innovate and make use of new seismic and sub-sea technologies to improve cost efficiency. Remotely monitored and operated drilling operations will allow for more effective use of skilled resources, and the development of special-purpose vessels on the sea floor will avoid the cost of fixed platforms and reduce the cost of deep-water production, whilst a shared infrastructure using a sub-sea power grid will reduce emissions from oil production.

Alex Salmond, the SNP leader, claims that North Sea oil reserves have a potential value of £1.5 trillion. However, the ‘Guardian’ argues that Scotland’s target of achieving 100% renewable electricity by 2020, saving 20 million tonnes of CO2, will be dwarfed by the release of 10 billion tonnes of CO2 through burning that oil over some 30 years. Decreasing fossil fuel emissions and increasing oil production are contradictions which Mary Robinson, the former Irish president, makes clear in her argument for the fixing of a carbon budget on oil-rich countries. Until new fuel systems remove the reliance on fossil fuels, the North Sea oil industry must continue to operate in the most efficient and technologically advanced ways possible, which it is taking steps to do.