NOF Energy, the business development organisation for oil, gas, nuclear and offshore renewables sectors, has published its annual survey, which reveals oil and gas will remain the core focus for its members in 2014.
The annual survey charts the activities of its 440 UK and international members and their opinions of the organisation’s business development services.
Almost three-quarters of respondents believe oil and gas will remain the priority sector for the next five years.
According to industry forecasts the subsea oil and gas market is particularly promising and is expected to grow by at least 20% in the next three years. With almost 45% of production on the UK Continental Shelf coming from subsea wells and 70% of new developments planned involving subsea installations the supply chain is set to take advantage of these opportunities.
Both offshore renewables and nuclear received a mixed response in the survey. For 35% of those surveyed, offshore renewables will however, remain a long-term focus and a key area for their business activities. Members also gave a mixed response to the nuclear industry, with almost 30% of respondents seeing it as still having potential for the future.
In addition to members’ operations in the existing sectors, 60% of respondents indicated that the emerging shale gas market is an area of real interest.
The survey also highlighted the continuing importance of exports to its members. With almost 70% of those surveyed exporting to markets in Norway, UAE, USA, Australia, Netherlands, Saudi and Brazil remain high on the agenda. The Russian market is also seen as increasingly important for the future.
NOF Energy’s annual survey also found that over 30% of members report that recruiting experienced and qualified personnel is a continuing challenge.
Clare Weirs, director business services, at NOF Energy said: “The dominance of oil and gas in the energy mix is clearly reflected in the focus of our members. With record levels of investment destined for the UK Continental Shelf, established, technology-led companies, with experience of operating in this sector, are in a prime position to benefit from the increased activity.
“NOF Energy members are fully aware of the demand for new technologies and the need to build long-term supply chain relationships with both the operators and contractors.
“Exports also remain a key priority for our members and the multiple and diverse markets they are successfully serving demonstrate the high regard in which UK skills, products and services are held by the global energy industry. It is also positive to see that NOF Energy members, with our support, are continuing to target new and emerging markets that will benefit from the innovative and expert approach taken by the UK supply chain.”
New North Sea field setbacks
Late last month Norwegian oil and gas firm Statoil said it has delayed the development of its Bressay heavy oil field in the UK North Sea in a bid to reduce its development costs.
Bressay, thought to contain between 200 million and 300 million barrels of recoverable oil, was expected to cost up to $7bn (£4.2bn), a relatively high figure because of difficult conditions.
Discovered in 1976, it had lain dormant for decades because it was too expensive to develop, but Statoil revisited the project after technological advances reduced costs.
Likewise in late November Chevron said it was postponing the planned go-ahead on its Rosebank development, west of Shetland.
It said: “The Rosebank joint venture participants continue to work the front end engineering and design work and are focusing their efforts on developing an optimum development solution for Rosebank.
“Rosebank represents a large, undeveloped resource base in the UKCS, requiring significant investment to unlock its potential. The Rosebank team is working diligently to ensure that this investment fully optimises the value of Rosebank for all stakeholders.
“At this time, a final investment decision is currently planned for 2014.
“Chevron’s view is that the project does not currently offer an economic value proposition that justifies proceeding with an investment of this magnitude.
“Chevron will continue to work with all joint venture participants to further improve the project value.”
Both of these projects were likely to create and support hundreds of jobs in the North East supply chain.