A new report from trade group Oil & Gas UK said that more new North Sea investment is expected in 2018 than the last three years combined.
The Business Outlook report said 2018 production is set to increase 5% — making it 20% higher than five years ago.
The report said between 12 and 16 oil and gas developments could get the go-ahead in 2018 – unlocking investment of around £5 billion.
Oil & Gas UK said the developments set to be approved this year could yield more than 450 million barrels of oil and gas over time — but this still falls short of the level required to sustain long-term production at current levels.
It said while the project landscape for 2018 is the healthiest the industry has seen since 2013, greater exploration success and maximising the potential within existing assets are essential for the future.
Oil & Gas UK CEO Deirdre Michie said: “Our sector is leaner, more efficient and more optimistic than it has been in recent years and 2018 looks set to be a better year.
“What we have learned in our response to the downturn has made us better equipped to tackle the ongoing challenge of maximising production for the longer term and boosting profitability in the supply chain but without increasing overall project costs or damaging competitiveness.
“Our remarkable resilience owes a great deal to the ingenuity and innovation of our people.
“More projects are taking place and investment is happening because of the sweeping changes made to adapt to the challenging business climate.
“This has helped make the UKCS (UK Continental Shelf) one of the most attractive mature basins in the world in which to do business and we will continue to work hard to maintain our competitive advantage.”
More than 300,000 people still work in and support the oil and gas sector across the UK.
More than half of companies surveyed expect employee numbers to rise this year.
But some businesses are also reporting difficulties in recruiting people with certain skills and competencies, prompting a number to make refinements to trainee and apprentice schemes to try to address this.
Michie added: “We must recognise that many areas of the supply chain are still struggling with the impact of the downturn and have yet to benefit from any upturn in activity.
“It’s vital that we keep driving fresh thinking, innovative approaches and efficiency efforts.
“The short-term outlook for our sector is more positive with new projects and new entrants bringing new life to the basin, but there are undoubtedly longer-term challenges.
“We need more exploration if we are to get close to recovering the three to up to nine billion barrels of yet-to-find hydrocarbons on the UKCS, matched by a continuing focus on improving recovery from existing fields.
“The investment decisions we make today are key to how much we produce in the years to come.
“Oil and gas remain a vital part of the UK economy and will form most of our primary energy needs for many years to come.
“As we move to a lower-carbon economy, the UK needs to meet as much of its domestic demand for oil and gas from indigenous resources as possible.
“This will ensure security of supply, generate revenue for the Exchequer, support the supply chain and sustain hundreds of thousands of highly-skilled UK jobs.
“The energy market is changing but we will remain relevant for many decades to come.”