Aberdeen's economy continues to recover

There is fresh evidence from several quarters that Aberdeen's economy is continuing to recover from the recent slump in the worldwide oil industry.

The Granite City, renowned as the oil capital of Europe, was particularly badly hit by the downturn which saw many thousands of jobs lost across the UK.

But green shots of improvement have begun to become more evident in the north-east in the last few months.

Triple boost

Aberdeen has now had a triple boost from local employment figures, good news on the success of the latest offshore oil and gas licensing round and positive findings of a leading oil and gas survey.

New figures from the Scottish Government showed Aberdeen lost 9,000 workers as it experienced the sharpest decline in employment rates in Scotland in 2016. But, just a year later it had the most dramatic increase in the country - rising by 8,300 workers.

The 123,900 workers in the city last year was the second highest recorded, only a few hundred below its peak in 2015.

Another boost for the city came from the Oil and Gas Authority (OGA), which said the 30th offshore licensing round had been 'transformational'.

Following strong interest from oil explorers, it has offered 123 licences in British waters to 61 companies.

The OGA expects this round to very quickly lead to activity offshore, providing a welcome boost to exploration.

Oil service companies in Aberdeen and throughout the rest of Scotland are already preparing for an increase in business from the new work in the North Sea.

"The UK continental shelf is back"

Andy Samuel, chief executive at the OGA, said: "The UK continental shelf is back. Big questions facing the basin have been answered in this round. Exploration is very much alive with lots of prospects generated and new wells to be drilled." 

Lord Duncan, Parliamentary Under Secretary for Scotland, added: “The license awards are welcome news for the Scottish economy and the UK as a whole. The oil and gas industry is vital for the UK and the further exploration opportunities being created will help find potential new deposits and boost job prospects.”

Meanwhile, the latest oil and gas survey from Aberdeen and Grampian Chamber of Commerce found that almost two-thirds of contractors reported being more confident now than this time last year, with seven in 10 believing that next year will be even better.

Russell Borthwick, chief executive of the chamber, said the oil and gas sector had faced up to some significant and structural challenges over recent years and is beginning to emerge fit for the future.

He added: "It does appear that a corner has been turned, but we must avoid complacency. The future strength of the sector depends on operators, contractors and suppliers continuing to work together in the new way as the climate continues to improve.

"A steady recovery, not a return to boom and bust is what is required. What is clear is that oil and gas will remain a key contributor to the north-east of Scotland and UK economies for many years to come."