NEARLY half the oil and gas fields in the North Sea could be shut down over the next five years following the slump in the crude price, sector specialists have found.

Experts at Wood Mackenzie predict oil and gas firms will accelerate plans to decommission many mature fields that they decide it is not worth keeping running amid what is expected to be a long period of low oil prices.

The Edinburgh-based consultancy says 140 fields could be closed over the next five years.

“The fields most likely to be decommissioned are uneconomic without high oil prices to justify escalating maintenance costs and declining production which are unable to support the high operating costs,” said Fiona Legate, UK upstream research analyst for Wood Mack.

With around 320 fields in production currently the closures would represent 44 per cent of the current UK North Sea portfolio.

But Wood Mack’s prediction that 140 fields will close assumes a 70 per cent increase in the oil price from the current level, to $85 per barrel.

Brent crude traded at around 50/bbl yesterday compared with $115/bbl in June last year.

Wood Mack reckons around 50 fields could cease production even earlier than expected if the oil price returns to a level around $70/bbl.

Closures on the scale suggested would leave the North Sea industry a shadow of what it is today and could be expected to result in huge numbers of job losses.

North Sea oil and gas firms have shed around 5,500 jobs in recent months. Experts estimate as many as 65,000 jobs related to oil and gas activity have been lost since January last year.

The downturn in the industry will result in tax revenues plunging.

Wood Mack, which maintains huge databases covering the world’s oil and gas regions, noted firms are slashing investment in new North Sea fields in response to the oil price fall.

Only 38 new fields are expected to come onstream over the next five years. Many of these are still in planning.

Ms Legate said: "In 2015 operators have reacted to the low oil price environment by deferring spend and delaying sanction of new developments.”

She added: “In the current price environment there is a risk projects may be cancelled.”

The analysis suggests the number of producing fields could fall below 220 over the next five years.

The closures will leave oil and gas firms facing huge bills for the cost of decommissioning offshore platforms and other facilities.

Wood Mack reckons that by 2019 companies will be spending more on dismantling North Sea facilities than on developing new fields.

The bill will total £54bn at today’s prices by the time decommissioning is completed in the early 2060s.

The report follows a series of warnings about the impact the oil price fall will have on the North Sea.

But,it suggests the industry may face greater challenges than other sector-watchers have recognised.

On Tuesday Oil & Gas UK said firms would slash investment in the North Sea by more than two thirds in the next three years.

The industry body predicted 50 fields would be in the decommissioning process by 2018 compared with 14 currently.

However, the forecast only took account of fields that are expected to run dry.

Oil & Gas UK has noted some fields may be shut early for economic reasons.

Chief executive Deirdre Michie said yesterday the Government should consider cutting the headline North Sea tax rate further if the oil price continues to be lower for longer.

On Monday the new Oil and Gas Authority said whole areas of the UK North Sea may be shut down prematurely in response to the oil price fall.

The regulator warned there could be a domino effect if a company decided to close a field and others did not want to pay an increased share of the cost of running common facilities, such as pipelines.

Wood Mack noted firms have announced plans to retire five fields early this year, none of which had come as a surprise. It said only 30 fields have been abandoned in the UKCS to date.

In May Fairfield Energy announced plans to decommission the Dunlin cluster citing the depressed oil price and challenging operational conditions in the North Sea.

Last month Danish giant Maersk Oil said it wanted to shut its Janice installation, which produces from three UK North Sea oilfields.