11-06-05

UK oil production fell by 17 % year on year in March -- a decline the industry said was at odds with renewed investment in the North Sea.

Output slowed as the region revealed more evidence of its maturing fields, with figures from the Royal Bank of Scotland showing that combined oil and gas was down 13.5 % on the period in 2004.

Some 34 bn barrels of oil have been recovered from the North Sea since the first output 30 years ago, and the latest forecasts estimate future reserves at 28 bn barrels.

But RBS economist Tony Wood said investment in the North Sea had "improved significantly" -- a trend he expects to be increasingly robust.

The UK Offshore Operators Association has said that increased spend could half production decline to 7 % per year -- extending the life of the North Sea.

Investment has been put at £ 4.31 bn for 2005.

Source: The Scotsman