Oil spend growing

THE OIL industry invested more than ever before in the UK oil industry during 2011, despite complaints about the government’s new tax regime.

Edinburgh-based analysts Wood Mackenzie said capital investment reached an all time high of £7.5 billion last year, a trend they expect to continue until 2014.

The firm expects a further £2 billion to be invested west of Shetland, largely by French oil giant Total’s Laggan-Tormore gas project, which will export via Sullom Voe.

Drilling activity was down, however more money was spent developing existing assets.

Lead analyst Lindsay Wexelstein said: “Companies have turned their attention away from exploration and appraisal activity to developing fields for the time being as the stable, high oil price environment has offered them the opportunity to focus on progressing development projects to turn reserves into revenue.”