Increase In Productivity Expected In Oil And Gas Economic Report

Oil and gas production is set to rise for the first time in 15 years, according to provisional figures.

Initial indications suggest there could be a 2.5% increase in the first half of this year compared to 2014.

Industry body Oil and Gas UK said: "It has been described as `"positive news'' amid the lower oil price and job cuts across the offshore industry.

The Golden Eagle field, which only started producing in November 2014, has been highlighted as a key reason in the production increase.

Speaking before the publication of Oil & Gas UK's economic report next month, which will include fuller figures, chief executive Deirdre Michie said: "Recent provisional figures from the Department for Energy (DECC) suggest that oil and gas production from the UK continental shelf (UKCS) over the first six months of this year could be 2.5% higher than the same period last year.

"It's still early days but initial indications suggest that production could increase this year for the first time in fifteen years.

"Provisional data for the first six months of 2015 show liquids production to be up around 3% and net gas production to be up around 2.5% this year, compared to the first six months of last year.

"Production in the second quarter of the year looks particularly encouraging and early figures suggest that May saw the most oil and gas produced on the UKCS since March 2012.

"We will be able to discuss annual estimates with more certainty by the end of the summer maintenance season as figures for July and August are historically the most uncertain.''

Ms Michie added: Clearly the oil price - which has more than halved since this time last year - continues to really challenge the industry.

"However, this positive news can indeed be attributed to the effort and investment industry has put into improving the integrity and performance of UKCS assets - something we'll look to explore in further detail in our economic report 2015.''