This paper examines the future prospects for oil and gas in the UKCS with the use of a large financial simulation model. The model contains as inputs all the known information relating to (a) currently producing fields, (b) those under development, and (c) discovered but not developed prospects. The model operates by triggering the development of a field when a given minimum rate of return is in prospect.
The main findings of the study are that oil and gas production will rebound to reach a new peak in the mid-1990s. Gas production from the Central North Sea and the Southern Basin could be buoyant well into the next century, depending on whether recent discoveries are eventually developed. New development investment will be very high in 1991 and 1992 but fall off somewhat in the middle of the decade. A further upturn is forecast for the later years of the decade. North Sea oil and gas will continue to make a major contribution to the UK economy well into the next century.