UKCS Production Efficiency

• Overall 2019 United Kingdom Continental Shelf (UKCS) Production Efficiency (PE) hit 80%, achieving the OGA PE KPI target. 

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• Production increased by 1%, equivalent to 7 million barrels of oil equivalent (mmboe), while Production Potential decreased by 40 mmboe, a 4.8% reduction from the previous year.

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• Total Production Losses decreased by 25% to 146 mmboe.

UKCS Production Efficiency (PE) improved for the seventh consecutive year reaching 80% and achieving the UKCS PE target three years ahead of schedule. 80% production efficiency represents a five percentage point increase on the 2018 UKCS PE with 43% of UKCS hubs achieving PE of 80% or more. This is a significant achievement and reflects the continuing efforts by industry to improve operational efficiencies.

Production Efficiency (PE) is a core element of the industry production optimisation and asset stewardship focus which is vital to maximising economic recovery from the UKCS. Production Efficiency serves as a Key Performance Indicator (KPI) for the OGA as outlined in the Corporate Plan 2019 – 2024. The PE KPI target was set at an 80% UKCS Average Production Efficiency by the end of 2022.

According to the SPE Production Efficiency best practice guidance and as utilised in this report, Production Efficiency is the total volume of hydrocarbons produced as a percentage of the theoretical economic maximum production potential.

Production Efficiency Model

Actual Well Production (AWP) rose marginally by 1% from 632 million barrels of oil equivalent (mmboe) in 2018, to 639 mmboe. This was accompanied by a 40 mmboe reduction in economic maximum production potential (EMPP) to affect the 5 percentage point increase in PE in 2019.

Regionally, the Central North Sea (CNS) and Southern North Sea (SNS) and Irish Sea (IS) regions  experienced declines in EMPP, reducing by 21 and 24 mmboe, respectively. The Northern North Sea (NNS) and West of Shetland (WoS) region experienced a small increase in potential, leading to an overall net decline in EMPP.   In 2018, the large 27 mmboe decrease in EMPP in the CNS area and combined smaller decrease in the SNS & IS region were counteracted by a significant increase in EMPP in the NNS & WoS region, largely as a result of new fields coming on stream. 

Regional Production & Potential Changes

UKCS Production Efficiency Area Trends

The interactive dashboard below explores Production Efficiency on the UKCS in more detail and across regions. Views can be filtered by year and regions using the buttons in the top left of the dashboard. Insights for each filter selection are summarised in the bottom left text panel.

 The reset filter button returns the dashboard to the default view.

At hub level, Production Efficiency increased for all infrastructure types with large platforms and small manned platforms achieving a PE of 80% and greater. Improved efficiency of unmanned hubs in the Southern North Sea area drove a significant 14 percentage point increase in PE for Unmanned platforms. The Production Efficiency distribution across hubs show shifts towards higher efficiencies. The bottom quartile range rose from 19% - 64%, to 36% - 71% and the average hub Production Efficiency increased by five percentage points to 77%.

Production (AWP) in 2019 increased as a result of new fields, improved industry asset maintenance strategies and deployment of new technology. Conversely, total EMPP across the UKCS was negatively impacted by the natural decline of the basin and cessation of production on six hubs in 2019. 

Hubs in the UKCS were shut down for a total of 2,074 days in 2019 only 14 days longer than planned, demonstrating an improvement in the estimation of shutdown duration. 1% overruns show a marked improvement from 15% overruns in the year before, while 120 Turnaround (TAR) days were deferred to subsequent years. The duration of unplanned shutdowns decreased by 42% from 2018.

Total losses to production dropped by 25% in 2019 with a corresponding decrease in percentage of potential lost from 23% in 2018 to 18% in 2019.

UKCS Production Losses Trends

UKCS production losses are mainly categorised into Plant, Export, Well and Market Losses according to the production choke model in the SPE Production Efficiency best practice guidance. Due to the UKCS hydrocarbon sales arrangements, market losses are not considered as significant as plant, export and well losses, however, it is important to track them to ensure they do not present obstruction to sales or production.  

An impressive 25% drop in UKCS combined production losses (plant, export, well and market losses), from 196 mmboe in 2018 to 146 mmboe in 2019, was largely driven by reduction in plant losses (-29%) and export losses (-20%). For plant losses, reductions in full plant and gathering system losses were key contributors, while decreases in planned and unplanned terminal outages as well as pipeline operator constraints (blending/backout) led to the decline in export losses.

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The dashboard below shows the UKCS production losses in depth and across regions.

Export losses reduced by 20% in 2019, driven by an average of 37% decreases in planned and unplanned terminal outage losses, and a 13% reduction in pipeline losses. Shuttle tanker, Cross-over, Export Force Majeure and Utilities Import losses all increased compared to 2018. These increased losses could be attributed to a long shutdown of a system common to a number of hubs.

Reservoir losses remain the dominant loss category for the well loss type. In 2019, well losses dropped by 12%. This was driven by combined decreases in reservoir losses (24%) and completion losses (22%). Continuing a three-year increase, wellhead losses increased by 15%.

For detailed information on hub and operator level performance, operators can request their bespoke production efficiency operator benchmarking pack from the OGA by emailing  PPR.Team@ogauthority.co.uk.