The oil and gas industry has not exactly been short of news coverage. With the debate over fracking and shale extraction raging, more wide-ranging news has had to take something of a back seat. However, an annual review by the research and consulting firm Wood Mackenzie has brought some focus back to UK oil and gas, away from shale.
The report offers that the second half of 2014 may well be the most important year the UK’s oil and gas industry has faced for some time. Serious challenges face the industry, with degrading infrastructure, skill shortages and a lack of developmental investment just three causes for concern.
So is 2014 shaping up to be a definitive year? We spoke with Stewart Davis, Group CEO of tax advice and payroll experts
. He believes that although confidence is high amongst oil and gas players, there are quite rightly cautious notes being sounded: “Away from the media coverage surrounding shale gas exploration, there are wider issues being debated around the ‘here and now’ of UK oil and gas. To take a couple of examples, the missing of exploration targets in the North Sea catches the eye, as does the news that new fields are underperforming.”
“Despite the more attention grabbing cautionary notes in the report, there are of course good news angles as well. Oil and gas in the UK continues to create jobs, and demand is high for skilled contractors and experienced staff throughout the British Isles. There are new, very exciting fields set to come onstream towards the end of the year, so their performance will be closely monitored.”
“Obviously the huge elephant in the room for UK oil and gas is the Scottish independence referendum due in September. Such a colossal uncertainty hanging over a sector can create significant ripples, and those ripples manifest themselves in shaky confidence and concerned analysis. Whilst many of the issues the Wood Mackenzie report raises are of course valid, closer inspection reveals that the UK is on course for a positive 2014 in oil and gas.”
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