In late August at the Silver Darling Restaurant in Aberdeen, FWB Park Brown together with Apollo Engineering hosted a discussion dinner titled ‘Back to BNOC’ on the future ownership of infrastructure in the North Sea.
Our two speakers for the evening were Andy Hessell, Managing Director of CATS Management Ltd, and Paul Warwick formerly Executive Director for Repsol’s Europe, Middle East and Africa division. The invited audience comprised a cross-section of the oil & gas community from the E&P and Oilfield Services sectors to the investor and advisor communities, and industry regulators.
The focus of the debate was to discuss trends in oil and gas infrastructure ownership and what role, if any, government, private equity investors and E&P companies may have in preserving North Sea infrastructure in order to stimulate recovery in remaining reserves.
A discussion centred initially on the provocative title ‘Back to BNOC’ and explored the benefits or otherwise of government ownership of the infrastructure and comparisons with regions that have experienced government led intervention. With the recent influx of infrastructure investors being attracted to the North Sea, it was clear that this was deemed a positive influence as they had a vested interest in maximising the efficiency and productivity of their assets. The current and future role of the Regulator in the region was also questioned and it was a clearly held view that this will be an increasingly influential factor in the future of a mature region such as the North Sea.
With regard to the future, there was a clear view that private equity will continue to be attracted to infrastructure plays. There was also consensus that the operator mix will be significantly different a decade from now based on current investment trends which may result in a resulting consolidation of assets generally with the hoped for outcome that the North Sea would become characterised as a vibrant but likely smaller and more nimble and sustainable basin.