UKCS Underperformance Main Concern in the Case of Scottish Independence

Fiscal uncertainty, offshore boundaries and regulatory change would be the top three issues in the event of Scottish independence, Wood Mackenzie said in a report released on Wednesday, adding that the main concern for the industry would not change: the underperfomance on the UKCS is and will be the major concern for market participants. 

‘Wood Mackenzie says that oil and gas companies will be closely following the result of the referendum, and the potential issues which might arise in the event of a ‘Yes’ vote, but of more pressing concern to the industry is the underperformance of exploration and production on the UK Continental Shelf (UKCS),’ reads the note. 

The referendum on Scotland’s independence will take place on Thursday, with polls suggesting that the result is not trivial.

According to Wood Mackenzie, the recent record investments will partially reverse the long-term production decline, with a 12% increase between 2014 and 2018.  

‘Post 2018, decline is forecast to set in once more with production dipping below 1 million barrels of oil equivalent per day (boe/d) by 2023, less than a quarter of the 1999 peak.’