The UK could see its first increase in offshore oil output in over a decade this year and the start of a slight recovery, BP regional vice president for Europe, Peter Mather, said Tuesday.
His comments were balanced by a longer-term warning from France's Total that investment levels were slipping because of the UK fiscal regime.
Both companies also suggested they could live with an independent Scotland, ahead of a referendum on independence in September.
"This year could be the first in over a decade that UK offshore production does not fall, potentially leading to a slight increase in the next few years," Mather told a forum at the Platts Global Crude Oil Summit in London.
A fall in discovery rates in recent years and the need to increase recovery rates remained challenges, he said.
His comments echoed a forecast of a modest output recovery by industry group Oil and Gas UK in its recent activity survey for 2014.
Total monthly production of a sample of commonly traded crudes, Brent, Forties, Oseberg, Ekofisk, Statfjord and Gullfaks, has declined from 2.02 million b/d in 2007 to 1.16 million b/d in 2013, according to Platts data.
But in the first six months of 2014, total loadings of these grades are set to average 1.2 million b/d.
Total UK new business manager Paul Mason, though, warned of "storm clouds" for the UK industry, saying the tax regime, in particular, had contributed to falling investment.
There are signs the government is working to address this, including through its recent promise of a fiscal review, he said.
"We are seeing that a development boom in the last few years is easing. Forward plans are not there so much as they were, but the upside of that is that contractor prices are perhaps beginning to ease," said Mason.
"We have to compete more and more at headquarters level for global funds. In the UK, the metrics do not really match up as much as they used to."
SCOTTISH INDEPENDENCE
On the positive side, Mason said the government had perhaps realized that "you are going to end up with a bespoke tax system which is very complex to run. They are now doing a fiscal review of the whole basin. They are fully engaged."
Asked about the possibility of Scottish independence after the upcoming referendum, Mason said Total did not have a view on the politics.
"Do we take it as a risk? No. It is not factored in at the moment. Things always change. Will it cause a dramatic change? Probably not," said Mason.
"The Scottish government seems to recognize the importance of oil. What they say sounds very reasonable. They are not really threatening the oil industry."
BP's Mather was more cautious, saying his company had not changed its investment plans ahead of the referendum.
BP CEO Bob Dudley has said Scottish independence would add to the cost of doing business.
"If we have to deal with a separate government in Scotland, then so be it," said Mather. "We are not currently holding back on investment. We are clearly not changing any of our plans."
