Three-quarters of UK oil and gas workers set for North Sea exodus

Mark_Guest
Mark Guest

More than half of Scottish oil and gas workers are pessimistic about their short-term prospects and three-quarters of the sector’s UK work force are considering working abroad, according to a new study.

As the beleaguered North Sea industry continues to suffer from plunging oil prices, a survey by industry website Rigzone found that 71 per cent of respondents across the UK are thinking about moving overseas, with Scottish respondents citing a lack of job security as the main reason.

More than half (52 per cent) of Scotland-based respondents reported a lack of confidence in their career prospects over the next five years.



The news follows analysis by Oil & Gas UK, sector skills organisation OPITO and the Department for Business, Innovation & Skills that estimated the number of jobs supported by the industry will slump from a current 375,000 to 340,000 in 2019.

Offshore drilling operator KCA Deutag cut 230 North Sea jobs, amounting to 30 onshore support positions in Aberdeen with a further 200 offshore positions lost as a result of two clients pausing drilling operations.

The company also proposed a 5 per cent salary reduction to employees, saying that a further 500 positions worldwide are at risk.

BP announced in January it will cut 200 jobs and 100 contractor roles following a review of operations, after ConocoPhillips cut 230 jobs – Shell cut 250 jobs last August, and Chevron lost 225 in July.



The slump has also affected property prices with a report this week saying average rents had fallen in recent months.

45 per cent of industry workers employed in Scotland, and 44 per cent of those working elsewhere in the UK, said they were not holding out hope in the ability of recently announced tax cuts to stimulate more investment in the North Sea.

The UK government’s £1.3 billion package of support for the sector includes a cut to the “supplementary charge” on oil industry companies’ profits from 30 per cent to 20 per cent and a reduction in petroleum revenue tax from 50 per cent to 35 per cent next year.

A tax allowance is to be introduced to stimulate investment in the North Sea oil and gas industry alongside a £20 million fund for new surveys of the UK continental shelf, aimed at boosting exploration.



The survey of 963 oil and gas professionals across the UK found only 17 per cent believe the initiatives will be enough to stimulate meaningful investment in North Sea exploration over the next five years, with 38 per cent undecided.

A majority of Scotland-based respondents (67 per cent) said a return to stable oil prices was more important than government policy to boost UK offshore reserves.

Mark Guest, international managing director of Rigzone, said: “Oil and gas professionals are highly mobile.

“If assurances cannot be given by the industry about the mid to long-term career opportunities in the UK’S offshore market, our survey indicates that many professionals may simply look for work elsewhere. This could exacerbate recruitment issues in the sector at a time when the industry has already highlighted a shortage of engineering students graduating from British universities.”


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