UK Continental Shelf (UKCS) operators spent 9% less per barrel of oil produced in 2025 than they did in 2024, according to a North Sea Transition Authority (NSTA) report.
According to the NSTA’s UKCS Unit Operating Cost report, the average cost to produce 1 BOE fell from £19.60 in 2024 to £17.81 in 2025, while the Brent crude price averaged £52.33/bbl in 2025. The report indicates operating expenditure dropped by £700 million from 2024 to 2025, while production rates held steady at about 1.1 million BOEPD in both years.
The report indicated that the closer fields are to ceasing production, the higher their unit operating cost tends to be. NSTA said several such older assets ceased production in 2025, while a number of new fields went onstream, which helped reduce average operating expenditures per barrel.
More than half of operators in the reported lowered unit operating costs between 2024 and 2025.
The regional breakdown in average unit operating costs for 2025:
- West of Shetlands—£11.90
- Northern North Sea—£22.60
- Central North Sea—£14.30
- Southern North Sea and East Irish Sea—£12.64
The NSTA said the production efficiency, which increased by 1% from 2024 to 76% in 2025, contributed to improved unit operating costs. Production efficiency compares actual production with maximum potential output, and in an August report, NSTA said the increase equated to about 21,000 BOEPD and was a positive development after production efficiency had dropped 2% between 2023 and 2024. The NSTA’s overall target is 80% production efficiency.
Loraine Pace, the NSTA’s head of performance and planning, in a press release called the improved unit operating costs across the UKCS encouraging and cited the importance of striving for further improvements.
The report noted a “modest” increase in unit operating costs for 2026 and 2027, to around £18/BOE or £19/BOE, as production declines slightly faster than operating expenditures.
“With costs projected to rise slightly in 2026 and 2027, it is important that operators focus on efficiency, continue to innovate and use new technologies, and share lessons to keep a lid on costs, while continuing to undertake necessary maintenance,” Pace said.
The report’s data were provided by operators to the NSTA through the UK Stewardship Survey and Petroleum Production Reporting System.