Investment & Expenditure – Introduction and Background

Since its beginning in the mid-1960’s, the upstream oil and gas industry has invested heavily in exploration and field development, with production and manufacturing industries together investing £16 billion in 2005 in the UK, no less than one third of which (over £5 billion) was made by oil and gas explorers and producers and the supply chain on their behalf. This level of investment is indicative of the industry’s importance for productive investment and its commitment to recovering the maximum amount of oil and gas within the current business climate.

However, expenditure forecasts suggest that higher costs and taxes are beginning to adversely affect the ability of the UKCS to retain its international competitiveness in attracting investment funding.

Investment & Expenditure – Key Statistics and Commentary

In 2005 oil and gas explorers and producers and the supply chain spent over £5 billion in capital investment in the UK. This level of investment was one of the largest of any industrial sector. Investment however is only one form of the industry’s annual expenditure. In total, including exploration, development and operating costs, oil and gas producers have spent £370 billion (in 2006 prices) since 1970 on exploring for, developing and producing reserves from the UKCS.

UK North Sea Expenditure 1970-2006

Investment & Expenditure – Supplementary Statistics and Commentary

For more information, see the Supplementary Statistics Section.