North Sea Faces Record Decline

Written By Jason Stutman

Posted August 23, 2013

The End of North Sea Oil?

Average oil and gas production in the North Sea is expected to decline between 1.2 million and 1.4 million barrels of oil equivalent per day (boepd) in 2013, according to Oil and Gas UK. This could represent a record fall in production, down from an average of 1.54 boepd in 2012. The new outlook contrasts prior forecasts that put production between 1.45 million and 1.5 million boepd.

This decline in production reflects the increased level of difficulty in extracting the North Sea’s remaining resources. Despite a record level of investment in the area (£13.5 billion), production in the North Sea continues its decade long decline. In 2003, North Sea oil and gas production averaged around 4 million boepd, but has declined every year since. As this trend continues,companies with major North Sea assets such as BP (NYSE:BP) and Statoil (NYSE: STO) will face decreased production, as well as increased operational expenses.

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Anyone who has been following the energy and tech markets this year knows what a stellar run Tesla Motors (NASDAQ: TSLA) has had so far. Despite strong opposition from special interest groups, a practically non-existent infrastructure, and well entrenched competition, Tesla continues to make enormous waves in the auto industry. At its core, Tesla represents both American ingenuity, and the strong spirit of capitalism and competition that work to make this country great. For more about Tesla’s ongoing battle against fearful auto giants, click here.

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