UK oil revival beckons as new technology, investors halt decline

Thu Apr 4, 2013 10:24am EDT
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* 14 new oilfields starting up over the next two years

* Technology boosts recovery rates from older fields

* Major works undertaken to improve field reliability

By Claire Milhench

LONDON, April 4 (Reuters) - New operators and better technology are set to reverse a decline in Britain's North Sea oil and gas output over the next few years, and could help the country's economy return to health.

Although output is expected to decline another 3-6 percent this year, it will rebound by almost a third by 2017 as some 50 oil and gas fields start production on the United Kingdom's Continental Shelf, industry body figures show.

Falling oil production held back growth in GDP by 0.2 percentage points last year, Office of National Statistics data showed, after acting as a drag in the previous two years.

This has damaged attempts by Britain's Conservative-led coalition government to stimulate growth, bringing the world's sixth largest economy close to its third recession in less than five years.

The government's record on economic growth will be a key factor in the 2015 parliamentary election, with the opposition Labour Party blaming austerity measures for anaemic output.   Continued...