In the UK Continental Shelf (UKCS), the future of the oil and gas sector rests on structural and fiscal considerations as well as the prospects for the oil price.
It should be noted, however, that our business in this region is more reliant on ongoing operational expenditure than on new capital investment, and we continue to work closely with clients to improve the cost effectiveness of their asset operations.
A trend we do see is for well-established operators to divest their assets in this region. Often they are succeeded by new entrants, who are looking for outsourced asset management services, and Petrofac is a natural partner (as we saw when the Anasuria Operating Company took over the Anasuria cluster in early 2016).
We believe Petrofac is in a good position to compete for a substantial UKCS decommissioning market. In 2016 we supported Tullow Oil’s decommissioning activity in the Thames Area Complex and were awarded a Duty Holder contract from BP to support the late life management of the Miller platform.