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North Sea energy transition exposed as drilling reductions are not compensated by development elsewhere
29/9/2026
News
Last year, no exploration wells were drilled on the UK Continental Shelf (UKCS), according to the 2026 Economic report published by trade association Offshore Energies UK (OEUK).
That figure is down from three in 2024 and sits alongside three appraisal wells drilled, according to the government regulator North Sea Transition Agency’s (NSTA) 2026 Wells insights report. It adds that 38 development wells were drilled, and goes on to forecast that five exploration wells will be drilled in 2026 and 32 in total before the end of 2028.
The stock of UKCS wells decreased 7% compared to 2024, to 2,298, consisting of 1,439 operating wells, 558 shut in and 301 plugged. In the year, 58 reinstated wells yielded 16mn b, at a reduced intervention cost down £2/boe to £7.60. Just under 400 interventions were carried out in the year.
Keith Hogg, NSTA Wells Manager, said: ‘A fall in the overall number of interventions and decline in E&A [exploration and appraisal] drilling, combined with rising rig costs points to a concerning loss of skills and resource.’
OEUK’s report said that UK production was 1.1mn boe/d in 2025, down from its 1999 peak of 4.5mn boe/d. It estimates that the offshore oil and gas industry supported 180,800 jobs (full-time equivalent) in 2024, or 28,200 by direct activity. By contrast, offshore wind supports 21,800 jobs directly. About 17GW of offshore wind installed capacity generated 52TWh of electricity in 2025, at an average load factor of 38%.
The report estimates that the pipeline of new offshore energy projects over the next decade amounts to more than £105bn.
The ramp-up of decarbonised industry in the North Sea is not keeping pace with the ramp-down of oil and gas in the region, according to a taskforce set up by Aberdeen & Grampian Chamber of Commerce.
Its new report, North Sea Transition Taskforce: one year on, finds that the window of opportunity for the energy transition has not shut, but it has narrowed since its first report in 2025.
The report complains that too little has been done: the government still has not consented to developing the Rosebank and Jackdaw fields; the energy profits levy is still in place; the NSTA has not been reformed; nor have transitional energy certificates been meaningfully realised. Separately, in July BP announced plans to sell off its UK North Sea generation assets.
The report says that 80% of the 115,000 jobs supported by the UK offshore energy industry (including in the supply chain) are in oil and gas. ‘If oil and gas activity falls away before offshore wind, CCUS [carbon capture, use and storage], hydrogen and nuclear can absorb that workforce, the industrial base the transition depends on is lost, and with it the salaries, tax revenues, community investment and capability to build the North Sea of the future.’
