Business energy prices could rise as oil and gas operations scaled back - 10/07/2009
Businesses and domestic consumers looking to compare energy prices could find more cost fluctuations as the result of a scaling back of oil and gas operations.
A report from Oil and Gas UK reveals that the recession has badly affected industry funding and investment in exploration has fallen by well over £1 billion over the past two years, meaning the UK could become more reliant on imports, reports the Telegraph.
Around £4.8 billion was invested in the industry in 2008, but the figure needs to top £5 billion if the estimated 37 billion barrels of oil thought to remain in the North Sea are to be extracted.
Malcolm Webb, chief executive of Oil and Gas UK, told the paper: "Last year we had the credit crunch [and] next year we are looking at an energy crunch. I'm still very concerned about the lack of investment."
A serious lack of investment could result in oil fields producing enough to satisfy less than 15 per cent of the UK's national energy demand, meaning Britain could be more exposed to fluctuating import costs.
The government is keen to shift towards an energy policy that combines nuclear generation with renewable power.
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