Category: United Kingdom

ENLARGE Oil exploration companies, such as Tullow Oil, don’t have other parts of their business to fall back on when oil prices fall. Bloomberg News LONDON— Tullow Oil PLC Thursday said it was making its largest ever write off of $2.7 billion before tax, mostly resulting from unsuccessful exploration programs and the drop in value of licenses, discoveries and assets resulting from the plunge in oil prices . The write offs include a decrease in value of $600 million across all of Tullow’s assets, including producing oil fields, oil in the ground and equipment. They also include $1.2 billion related to discoveries in previous years that now have no prospect of commercialization amid the weaker oil prices and unsuccessful exploration drilling. The price of oil has more than halved in the past six months, hitting the exploration and production sector hard. Unlike the major oil companies BP PLC and […]

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ENLARGE BP’s Valhall redevelopment project in the North Sea. The company intends to cut 300 jobs in the area as part of a shake-out brought about by the slide in oil prices. European Pressphoto Agency LONDON— BP PLC said Thursday that it would lay off about 300 people in the North Sea hub of Aberdeen, Scotland, in the biggest sign yet of the problems besetting the U.K.’s primary oil-producing region. While the world-wide slide in the price of oil has focused attention on the U.S.’s relatively new shale fields—which are partially responsible for the global oil glut—it is the mature, high-cost fields such as those in the North Sea that seem likely to suffer most. At prices much below $75 a barrel or so, some of the North Sea’s reserves might be too expensive to develop. BP said Thursday that it is still committed to the region, and that […]

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ENLARGE Thursday’s decision narrows the range of penalties BP could face. Bloomberg News A federal judge ruled Thursday that BP PLC is liable for spilling just over 3 million barrels of crude into the Gulf of Mexico in the 2010 Deepwater Horizon disaster, 24% less than federal prosecutors had claimed. The ruling means that BP faces a maximum penalty of $13.7 billion under the U.S. Clean Water Act, down from the $18 billion sought by the Justice Department. The decision by Judge Carl Barbier surprised analysts following the case, coming days before BP is set to appear in his court for a related trial on how much it should pay for each barrel spilled. That tranche of the complex case, which begins on Tuesday, will determine the total fine under the Clean Water Act. Thursday’s decision narrows the range of penalties BP could face, which could make a settlement […]

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LONDON (AP) — BP has announced it will cut an estimated 200 staff jobs and another 100 contracting jobs in light of falling oil prices. The company said Thursday the cuts will be made in onshore roles, not in offshore operational positions. Regional president Trevor Garlick said BP remains committed to its North Sea operations but needs to take "specific steps" given the challenging economic environment. He cited toughening market conditions as a reason for the cuts. Union officials fear other oil-related jobs will be cut by other firms soon as prices continue to soften. The price for the benchmark U.S. crude oil is down about 41 percent in the past three months amid oversupply.

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ENLARGE Oil exploration companies, such as Tullow Oil, don’t have other parts of their business to fall back on when oil prices fall. Bloomberg News LONDON— Tullow Oil PLC Thursday said it was making its largest ever write off of $2.7 billion before tax, mostly resulting from unsuccessful exploration programs and the drop in value of licenses, discoveries and assets resulting from the plunge in oil prices . The write offs include a decrease in value of $600 million across all of Tullow’s assets, including producing oil fields, oil in the ground and equipment. They also include $1.2 billion related to discoveries in previous years that now have no prospect of commercialization amid the weaker oil prices and unsuccessful exploration drilling. The price of oil has more than halved in the past six months, hitting the exploration and production sector hard. Unlike the major oil companies BP PLC and […]

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Anchor handling of Semi submergible in North Sea BP has told staff in Aberdeen it is cutting 300 jobs in its North Sea business, under a wide-ranging cost-cutting plan announced in December. The UK-based oil major has outlined plans to cut the roles from its 3,500-strong North Sea business, based in Scotland, over the course of 2015. More On this story On this topic IN Oil & Gas The cuts include 200 onshore staff directly employed by BP and 100 contractors. Trevor Garlick, regional president for BP North Sea, said: “We are committed to the North Sea and see a long term future for our business here. However, given the well-documented challenges of operating in this maturing region and in toughening market conditions, we are taking specific steps to ensure our business remains competitive and robust, and we are aligning with the wider industry.” “Whilst our primary focus will […]

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Low prices of oil starting to reflect trends in the global economy. (UPI/Shutterstock/Lilac Mountain) The price for Brent, the crude oil benchmark based on North Sea blends, was off close to 3 percent from the previous session to trade near the $46 per barrel mark, the second consecutive day below $50 per barrel and a 5 1/2-year low. Oil prices are off more than half their June value, falling as markets swing to the supply side in a weakened global economy. The British economy became the latest to show signs of a slowdown. The Office for National Statistics said Tuesday consumer price inflation in December was down 0.5 percent and 1 percent for November, some of the lowest rates on record . British economic data mirrors developments emerging elsewhere in the region. Inflation in an already struggling eurozone turned negative in December, driven in large part by falling energy […]

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Low oil prices means the future of North Sea oil and gas is uncertain, Wood Mackenzie finds. File Photo by Casey J. Ranel/UPI LONDON, Jan. 12 (UPI) — Low oil prices are a growing cause for concern in the exploration and production sector of the North Sea, analysis published Monday by Wood Mackenzie finds. The analytical group said the region brought in $19 billion in capital spending last year, making the British North Sea sector one of the top 10 for upstream spending. With oil prices falling more than 50 percent since June, data show exploration and production activity was slowing down . Erin Moffat, a senior research analyst at Wood Mackenzie, said exploration activity in 2014 was off 18 percent from the previous year. Only four fields were brought online. "The current oil price means 2015 will unsurprisingly bring further budget cuts, with exploration spending at the top […]

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A BP oil and gas platform in the British North Sea Oil prices are on course for their largest annual slide since 2008, capping another dire year for commodities, as crude fell again on Tuesday to hover at close to half its level of six months ago. Brent’s 49 per cent plummet since June — alongside a near halving of iron ore prices and sharp drops in coal and copper — has also helped drag the Bloomberg Commodity index down 15.6 per cent in 2014 to a five-year low. While the international benchmark’s price plunge could prove a significant boon for the global economy, it has thrown big oil exporters such as Russia and Venezuela into disarray, and forced oil companies to re-examine their investment plans and look for ways to reduce costs. In a sign of how the oil majors are scrambling to make savings, BP , Royal […]

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Oil companies working in the British seas may face tight purse strings in current bear market for crude oil, analysis finds. (Photo: BP p.l.c.) Brent, the global price benchmark based on oil blends taken from the North Sea, is trading near the $60 per barrel mark, far below the price for the June contract. Ewan Mitch, lead analyst at British firm Company Watch, said the bear market is putting a strain on the pocketbooks of many regional companies. "The recent large falls in the price of oil and gas could leave the weaker companies in difficulties, especially the ones that need to raise funds to keep exploring," he said in the report. The price for Brent is approaching the point at which companies might not be able to generate a profit. British energy company BP said it could cope with an oil price as low as $60 per barrel, […]

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