Economic Report 2023 - Offshore Energies UK (OEUK)

Figure 13 UKCS capital investment outlook

It is likely that there will be in the region of £3.5bn-4.0bn of capital investment in the basin this year, which is lower than may have been expected at the beginning of the year as new field approvals have remained slow. Although this is a similar level to previous years the impact of this investment will be less owing to inflationary effects. There is £35bn of potential oil and gas capital investment over the next 10 years, of which about half will go on projects in producing fields and half on new fields. However, most of this investment (almost

70%) is yet to be secured. Without it, the UK will produce 1.2bn boe less over that period, and the loss will get larger over time. There is also up to £70bn to be spent on operations and over £20bn on decommissioning during the same period. Achieving this depends on several factors which impact on investor sentiment and project economics – such as the competitiveness and stability of the fiscal regime, the cost environment, commodity prices and, importantly, government support for new licensing and exploration.

The oil and gas industry in the next 10 years

Almost £70bn in potential operating expenditure.

£35 bn

spend. £20 bn

Over £20bn in decommissioning

Around £35bn of potential capital investment.

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ECONOMI C REPORT 2023