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March 15, 2015

Report says 92% of UK oil and gas firms plan expansion in next two years

A new report by Bank of Scotland has revealed that 92% of UK oil and gas firms are planning to expand in the next two years despite lower commodity prices and increasing production costs.

By admin-demo

A new report by Bank of Scotland has revealed that 92% of UK oil and gas firms are planning to expand in the next two years despite lower commodity prices and increasing production costs.

The survey was carried out on 101 firms, of which 73 expect headcount to rise with only nine anticipating a reduction.

The companies are expected to add 8,000 staff in the next two years, down from about 10,000 since 2013.

A quarter of firms are looking to merge with or acquire another company and 21% of firms said the taxation regime was one of their worries.

"This research paints a clear picture of a global industry, which having dealt with similar commodity price challenges in the past, is determined to come through fitter and stronger."

The report said the number of firms expressing an interest to expand into onshore shale production has increased by 27% from 2014.

Bank of Scotland area director of commercial banking Stuart White said: "While it is obvious the North Sea is facing some serious challenges, this research paints a clear picture of a global industry, which having dealt with similar commodity price challenges in the past, is determined to come through fitter and stronger.

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"Firms continue to be concerned by an ageing workforce and a lack of skills, which explains why the industry is determined to get through the current storm without major workforce reductions.

"North Sea firms are seen as world leading, so it is therefore not surprising they are looking at international expansion opportunities where they can enjoy continued growth backed by the strong expertise they have developed here in the UK." 

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