Report highlights drop in new drilling activity

A new report from the Oil and Gas Authority (OGA) points out that the number of plugged and abandoned wells in the North Sea has overtaken fresh drilling as exploration keeps falling.

The regulator has issued its first Well Insights report, assessing the well stock of the UK Continental Shelf.

In total, 163 wells were abandoned last year, up from the predicted 140, and beating the combined total of 106 wells drilled in 2016 and 2017.

The report says 120 are scheduled in the next three years as the regulator states there is a need to “substantially increase new well drilling”. Of the 120 scheduled, just 18% have financial approval.

Gunther Newcombe, the OGA’s director of operations, said: “There are many examples in the report of industry delivering performance improvements and undertaking innovative approaches to well management.

“There is also an indication of an upturn in new well activity, all of which are positive indicators.

“However, there is also a need for a concerted effort by industry to substantially increase cost-effective drilling activity, improve the management of existing well stock and reduce well abandonment costs to maximise reserves, sustain production and minimise decommissioning costs.

“This can be achieved by leveraging lessons learned, exploiting technology and working corroboratively with the supply chain to achieve transformational performance gains.”

Guther Newcombe, the OGA’s director of operations