It’s happening around the world – except in Alaska. Old fields roaring back to life thanks to new technology funded by new investment and above average oil prices.
In tax friendly North Dakota, production has soared from 123,620 barrels a day (bld) in 2007 to 639,277 bld last year.
Alaska’s production fell more than 100,000 bbl during the same period.
While in tax friendly Texas, which has been producing oil since the 1860s, daily production has grown from 921,000 barrels to 1,233,000 barrels over the past five years.
The North Sea, which is about the same age as Prudhoe Bay, is undergoing a renaissance. “The expansion has been spurred by record-breaking levels of investment, with about 40 billion pounds set to be ploughed into North Sea production in the next three years,” reports The Independent, a national British newspaper.
“The surge in investment comes after the government relaxed the tax regime around North Sea development, prompting a record-breaking licensing round when the Department of Energy and Climate Change awarded 167 new licenses on 330 blocks last October.”
“Industry body Oil & Gas UK said the Chancellor’s promise of certainty on decommissioning tax relief and new tax breaks on small and deepwater fields would stimulate tens of billions of pounds of additional investment,” wrote a British trade publication.
“The tax break could cut the bill for companies operating older oil and gas fields by as much as 160 million pounds,” according to The Telegraph Media Group.
“It is estimated it will cost the Government around 100 million pounds in lost tax revenue initially but politicians expect the long-term benefits of more production from the North Sea to ‘significantly outweigh’ this.”