Energy giant BP has announced plans to invest almost £10 billion in developing four new North Sea oil and gas projects over the next five years.
The company said that the investment, which will be made with its partners, will help to maintain BP’s production from the North Sea “for decades to come”.
The UK government yesterday granted BP and its partners—Shell, ConocoPhillips and Chevron—approval to proceed with the £4.5 billion Clair Ridge project, the second phase of development of the Clair field complex, west of the Shetland Islands.
The Clair Ridge project will install two new bridge-linked platforms with the capacity to produce approximately 640 million barrels of oil. The project is expected to come on-stream in 2016 and to extend production from the greater Clair area to 2050.
The overall Clair field complex is the UK’s largest hydrocarbon resource, with over seven billion barrels of oil and gas initially in place.
BP’s share of the total investment into the four projects will be around £4 billion—the company’s highest level of annual investment yet into the UK North Sea.
BP said that over the next few years, it will be bringing on stream more new major project developments in the UK than it has ever done over a comparable time period.
Commenting on the approval for Clair Ridge, UK prime minister David Cameron said: “I am delighted to give the go-ahead for this project; this investment is great news for Aberdeen and the country and provides a massive boost for jobs and growth. It shows the confidence that there is to invest in the North Sea—we have cutting edge technology, world class skills and expertise and a UK government that is committed to do what we can to secure future investment.”
BP’s chief executive Bob Dudley commented: “Although it began over 40 years ago, the story of the North Sea oil industry has a long way yet to run. BP has produced some five billion barrels of oil and gas equivalent so far from the region and we believe we have the potential for over three billion more.
“After some years of decline, we now see the potential to maintain our production from the North Sea at around 200,000 to 250,000 barrels of oil equivalent a day until 2030. And we are working on projects that will take production from some of our largest fields out towards 2050.”
He concluded: “The efficient management of giant fields such as Clair, using state-of-the-art technology to manage complex reservoirs and increase oil recovery, is an important element of BP’s strategy and one of the key drivers that we see generating value in BP’s upstream business.”
Over half of the total investment in the projects is expected to be spent in the UK. At their peak, the projects together will provide around 3,000 UK oil and gas supply chain jobs.
