U.K. oil and gas production efficiency rises to 73%

Production efficiency on the U.K. Continental Shelf (UKCS) has risen for a fourth consecutive year to 73 per cent, according to a new publication released by the Oil and Gas Authority (OGA), representing an additional production of 12 million barrels of oil equivalent (boe) compared to 2015.

The report, UKCS Production Efficiency in 2016, compares actual production in 2016 to the theoretical maximum economic potential of the fields and associated infrastructure, compared to previous years.

Data were collected as part of the OGA's 2016 UKCS Stewardship Survey, which allowed for a more in-depth analysis in key areas, for example in looking at the major causes of lost production.

Production efficiency (PE) is an important indicator for the industry and the OGA as a core element of production optimization and asset stewardship performance, the OGA said in a press release. In its Activity Plan 2017 and 2018, the OGA identified PE as a Key Performance Indicator (KPI) for industry, with a target of 80 per cent PE for the UKCS by the end of 2018.

Recent years have seen the UKCS reverse the declining trend in both PE and overall production. From 2012 to 2016, losses have fallen by 157 million boe while production has risen by 34 million boe.

"Industry's combined persistence and focus on increased production efficiency in the UKCS has delivered an additional 12 million barrels in the past 12 months,” Gunther Newcombe, OGA operations director, said in a statement.

"There remains more work to be done to meet the OGA and industry's joint PE target of 80 per cent. In 2016, there was the potential to increase UKCS production by 29 million barrels. If these projects were completed, this would have increased UKCS PE by another three per cent.

"Operators in the UKCS today are working in a diverse landscape, many operating mature assets, in increasingly interdependent fields with vastly differing scales of production and ranges of efficiency. This report highlights no correlation between total size of production and efficiency with examples of highly efficient large producers, less efficient small producers and vice versa.”

Other key points from the report include:

• In 2016, 38 per cent of hubs met or exceeded the overall target of 80 per cent for the UKCS, compared to 30 per cent the previous year.

• Over four years, increases of up to 57 per cent (absolute) have been seen in operator production efficiency.

• Since 2012 there has been cross industry improvement with 88 per cent of operators increasing in efficiency.

• Total losses in the UKCS were 210 million boe. Plant losses are the largest category in most areas, with the majority of losses caused by full plant outages.

• In 2016 there was a potential 'prize' of an additional 160,000 boe a day equating to 59 million boe a year from all hubs hitting an average PE of 80 per cent in the UKCS.