UK oil and gas industries are reportedly entering the last decade of production, according to research conducted by the University of Edinburgh, Scotland.
Dwindling reserves
Oil and gas reserves now stand at 11% and 9% respectively. Analysis of hydrocarbon reserves showed discoveries consistently fell behind output levels since the industry’s peak in the late 1990s, meaning the UK could soon have to import all its oil and gas needs.
The Scottish Oil & Gas Industry would be the largest affected. Recently, the industry began to see a resurgence, with a production of 74.7 million tonnes of oil in 2016-17. Official statistics showed oil and gas production had been increasing year-on-year by 2.9% in 2016-17 – to its highest level since 2011-12. These figures represent 82% of the UK’s oil and gas production, an industry which employed 330,000 workers in 2016.
What happens now?
Researchers revealed fracking – injecting liquid at high pressure into subterranean rocks and boreholes to open existing fissures and extract oil or gas – will not be an economically viable alternative to oil and gas in the long-term, mainly due to an absence of suitable locations and geological features. Possible production sites are either in densely populated areas, have low quality source rocks or complex geological histories. The University of Edinburgh study instead recommends increasing the use of renewable energy, calling for a “bold energy transition plan”.
The UK has been making strides in improving its generation of clean energy. In April, Britain saw its first coal-free day since the 1880s, while the National Grid reported that on the 7th June power from wind, solar, hydro and wood pellet burning supplied 50.7% of UK energy.
A shifting workforce
Employment is also seeing a shift towards renewables. In 2015, the number of jobs supported by the UK’s Oil & Gas Industry fell by an estimated 84,000, with another 40,000 leaving for other employment in 2016. More than a third of marine engineers working offshore have made the move from oil and gas to renewables, while by the end of the decade employment in the UK’s offshore wind sector is expected to double in size.
The existing skillset of oil and gas workers will also transition well towards renewables, especially offshore. The migration of skills has already begun, and renewables companies are starting to see the benefits of skills already possessed by oil and gas workers.
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