The Offshore Technology Conference (OTC) is now entering its 50th year. Interestingly, the year of the first conference coincided with the Ekofisk discovery, heralding the start of the northern North Sea as a basin back in 1969.
Since then, the relationship between Aberdeen, Houston and offshore technology has flourished. The first OTC conference was a direct response to the need for new technology in the global ocean extraction and environmental protection industries. In today’s economic landscape, the need for innovation continues to grow.
With the oil price maintaining a rise at the time of writing we are seeing increased confidence in the market after the downturn. As a result, exploration and investment is returning to the offshore sector.
Burness Paull recently supported clients in securing the financing necessary to enable them to acquire additional exploration acreage, and with Chysaor’s recent acquisition from Shell it shows confidence is returning as the industry adapts to the new normal. This can also be seen from private equity investment in the service sector increasing, as well as an increase in M&A activity, making Aberdeen a desirable area to buy in the market once again.
Oil and gas has always dominated the energy landscape in Aberdeen and Scotland, although recently Aberdeen has been forced to diversify its economy. This can be seen from the establishment of various private sector led and funded investment initiatives, the aim of which is to rebalance the region’s economy and encourage new start-up technology-driven enterprise.
Diversification and development of existing skills is something Houston is already at the forefront of, boasting large alternative sectors in manufacturing and technology, healthcare and the life sciences, aerospace and aviation and with the creation of the Port of Houston, a logistics and distribution hub.
Despite continuing to be an oil and gas powerhouse Houston already generates 90% of its municipal electricity from renewable sources, allowing it to export its oil and gas resources.
So again, we look to Houston as a leader for what we are trying to achieve.
We predict that Aberdeen will use its entrepreneurial spirit to
spot opportunities for gaps in the market and apply the skill base and resource it already wields in the oil and gas Sector to other forms of energy.
The application of oil and gas skills to marine renewables is already coming to fruition, with some of the most innovative examples being Hywind, Pentland Firth, the European Offshore Wind Deployment Centre and the Kincardine Offshore Windfarm Project.
The UK is already a leader in offshore wind and, with Scotland boasting 25% of Europe’s offshore wind resource our companies’ depth of experience, innovating in the offshore environment can certainly be brought to bear.
However, it is likely that a growth in renewable energy will also come as a result of the Scottish Government’s ambitious renewable energy target to derive half of its heat, transport and electricity consumption from renewable sources by 2030.
This sharing of ideas and business is as important as ever for us, our clients and the Aberdeen and Houston business communities, and the 50th anniversary of OTC is great illustration of this strong collaborative relationship.
Helen Dickson is a partner at Burness Paull