| Show BUSINESS and the tha STOCK MARKET by BABSON'S REPORTS Copyright 1972 OIL FROM THE NORTH SEA It was two and a half years ago that thata a military coup in Libya overthrew the government and replaced it with one that was militantly socialistic An immediate development was pressure on the foreign foreign for ford eign oil and gas producers there to curtail curtail cur cur- tail production and increase tax and roy alty ally payments to the Libyan government The threat of expropriation of oil properties properties pro pro- became real and Libya is now nowa a very inconstant area in which to conduct conduct conduct con con- duct oil operations At about the same time bids were open for leases on the Alaskan North Slope Involving a region long known for its strong oil potential the sale attracted attract attract- ed all major oil companies and netted the state of Alaska some million It was felt that drilling success here would assure the 48 continental states of a bount bountiful ul source of crude and relieve relieve re re- re- re lieve hove dependence on foreign sources Enthusiasm was so great that pipe was vas ordered for a south north-south trans Alaska line and millions of dollars dollars' worth of equipment was flown in in But to date no more than a few barrels of ceremonial ceremonial ceremonial cere cere- oil have come out The crude is there in quantity but environmental questions have d delayed the pipeline and meaningful output is unlikely until 1974 or 1975 Turn To The Cruel Sea As it became evident that the Mid Mid- east cast must be considered prone to the whims of politics and that Alaskan oil would not be readily available the search turned to another known large sedimentary basin with oil-bearing oil possibilities possibilities pos pos- located mainly between England and Norway To the south in and offshore offshore off off- shore from the Netherlands huge gas discoveries were made in hi large enough to alter European mies Natural gas has also been f found 0 u n d in the E English n g 11 s h por por- portion portion portion tion of the Channel C h II a n n e 1 1 These discoveries were substantial enough to enable the British government to sponsor a residential heating gas-heating conversion conversion conversion con con- version program wl which ch has virtually eliminated eliminated eli eli- the use of soft coal and the notorious London fog caused by burning that fuel Cutting Up The Pie By treaty the North Sea is divided in such a way that bordering countries are entitled to offer drilling rights in assigned sectors off their shores Norway Norway Nor Nor- way and the United Kingdom control the largest areas areas and initial drilling successes successes suc suc- have been in these parts A year ear ago some 70 individual companies or combines held licenses for exploration or 01 production in the North Sa Operations Opera are risky and difficult due to ocean weather conditions but the technology of the new submersible semi-submersible drill rigs will do much to negate the elements clements These platforms are arc supported by huge submerged floats which are arc relatively unaffected by the motion of the sea even withstanding foot foot waves A recent estimate predicts that in two years there thero could be twenty drilling rigs at work and by 1980 sixty rigs could be in the area half of which might well be active producers Oil Giants Why is the North Sea crude worth going after Though drilling is only in initial stages several separate fields have been located Present proven jeser- jeser ves yes are estimated roughly y at five billion barrels but the potential may be many times that figure a real oil bonanza I Evidence of the worth and extent of the basin was seen sen in ht the British sector with a bid last August of 50 million for one six ninety square ninety square block far farto farto farto to the north of current proven discover ies les The bidder had apparently developed develop ed cd seismic data promising favorable drilling results mulls While it is unlikely that thatUS US U.S. oil requirements will be bo bolstered directly from North Sea production the area should benefit since they willbe will willbe willbe be less vulnerable to political overtones |
