| LONDON, March 28
LONDON, March 28 British Oil major BP is
to proceed with a $500 million-plus investment plan in the
remote Shetland Islands, another shot in the arm for North Sea
Though North Sea production has fallen by about two thirds
since 2000 and a surprise tax increase in 2011 led to dire
predictions about the region's future, industry body Oil & Gas
UK in February forecast a pick-up in production from 2014,
fuelled by a surge in investment.
The new investment by BP could bring a huge add-on project
at its Clair field and will be welcomed by a British government
eager to slow the decline in North Sea production after dramatic
falls in the past two years undermined attempts to kickstart
BP said on Thursday that it will drill at least five
appraisal wells in the giant Clair field off the west coast of
the Shetland Islands, north of Scotland, to discover whether it
is worth further development.
BP and its Clair partners, fellow oil majors Shell,
ConocoPhillips and Chevron, in 2011 said they
were investing 4.5 billion pounds ($6.8 billion) in a second
phase of development for the field, which first started pumping
oil in 2005.
"If successful, the appraisal programme could pave the way
for a third phase of development at Clair - this is now a real
possibility," BP's North Sea regional president Trevor Garlick
said in a statement.
Big oil companies have looked beyond the North Sea in recent
years, favouring new oil provinces with more potential, but the
rich geology of the areas around the Shetland Islands have kept
BP's plan for Clair follows other recent new investments in
the North Sea, including a $7 billion project announced by
Norway's Statoil in December and a 1.6 billion pound
($2.4 billion) investment by Canada's Talisman Energy
two months earlier.
BP, which has the biggest stake in Clair at nearly 29
percent, said that it has already started drilling the first
appraisal well and it could complete up to 12 wells over two
years, depending on the results of the first wells.