Amid higher oil prices, the UK's North Sea oil industry is talking up its somewhat slender prospects for revival.
Backers of the 50-year-old North Sea oil industry tend to be torn between an optimistic "glass half full" approach and the evidence of years of decline since production peaked in 1999.
A mini-revival in production in the last two years has helped keep hopes alive, with oil output running at nearly 1 million b/d -- still a third of 1999 levels.
But while output has nudged up, and operating companies have largely kept bankruptcy at bay, investment has plummeted since oil prices crashed in mid-2014. Lobby group Oil and Gas UK thinks investment in the UK upstream sector will have dropped by 40% in 2016 to GBP 9 billion ($11 billion).
That suggests that despite an expected boost from projects begun before 2014 -- including BP's redevelopment of two west of Shetland fields, Clair and Schiehallion -- production decline could soon return with a vengeance.
The International Energy Agency expects UK oil production to resume declining in 2017. North Sea consultancy Hannon Westwood says oil and gas output could soon be falling at rates of 11% per year.
Assessing the outlook for the North Sea industry is only partly about the oil price, which was recently supported by OPEC's decision to cut output. The government has tried to boost confidence by slashing upstream taxes, creating a new, independent regulator, the Oil and Gas Authority (OGA), and funding seismic surveys and facilities to the tune of GBP 40 million.
But North Sea projects are widely associated with delay, often due to harsh sea conditions, as well as difficulties attracting skilled labor to remote locations.
The start-up in 2016 of Total's Laggan-Tormore gas project west of the Shetland Islands was presented by the government as a "vote of confidence" in the sector, but may have acted more as a warning due to the delays and cost overruns that beset the project.
Another negative signal was sent by Chevron's long hesitation about approving the Rosebank oil project west of the Shetland Islands. In December Chevron canceled a $2 billion contract placed in 2013 for the project's Floating Production Storage and Offloading vessel, although there are hopes that a development solution will eventually be found.
Premier Oil's Solan project west of the Shetland Islands has also suffered technical problems since output started in April, while Ithaca Energy's Greater Stella Area project has also undergone delays.
On the other hand, both BP and Shell claim to have increased their efficiency in the North Sea under the pressure of low oil prices.
Shell chief executive Ben van Beurden has referred to the North Sea as a "pathfinder" for efficiency within the major's portfolio -- rare praise from a company that has distanced itself from its home province in recent years.
The smaller companies that have come to the fore in the North Sea have also cut their costs. The OGA reckons average operating costs have halved since 2014 to $15 for each barrel of oil equivalent produced. And private equity investors have moved into the space left by the near-collapse of London's Alternative Investments Market in 2008.
Amid these mixed signals, one question is crucial: is anything left in the North Sea to invest in? Exploration drilling offshore the UK has slumped in recent years, with just 13 exploration wells spudded in both 2015 and 2016, down from more than 80 in 2007. Nonetheless the OGA points to an improved discovery rate, with oil and gas discoveries in 2016 likely to total over 300 million boe. Such pockets of success may tempt back investors.
Taking pride of place is Hurricane Energy's oil discoveries on the Rona Ridge, west of the Shetland Islands. Hurricane says the Lancaster and Lincoln finds could total well over half a billion barrels. It aims to kick off a limited development of part of the Lancaster field in the first half of 2017.
Also talking up prospects is the US' Apache Corporation, operator of the Forties field, which contributes to the Brent benchmark.
It estimates that Forties still holds nearly 2.5 billion barrels of oil and says its enthusiasm has been boosted by two recent oil discoveries totaling 50 million barrels in the Beryl area, named Callater and Corona. It has submitted development plans for both.
Shell is expected to go ahead next year with a redevelopment of the Penguins cluster of fields, close to the near-exhausted Brent field, according to a source close to the matter. The Penguins fields are currently tied to the Brent Charlie platform, which is due for shutdown, and Shell plans to redevelop them using a more innovative cylindrical FPSO, with output peaking at 21,000 b/d.
With BP and China's Nexen among those planning exploration drilling in 2017, the Oil and Gas Authority is hopeful of a revival. It estimates that just the mature parts of the UK shelf could contain another 6 billion boe in undiscovered resources.
Alistair Stobie, chief financial officer of Hurricane Energy, argues that the North Sea industry is reforming itself and picking up the pace at which it works -- perhaps with the fast-paced US shale industry in mind.
He points to the speed with which Hurricane moved from raising funds for its Lancaster exploration well in May 2016 to drilling the well in July, and signing a contract for an FPSO in November.
"The industry is going through a revolution in terms of costing and how you build these projects," Stobie told S&P Global Platts recently. "Where the change will come is in smaller scrappier teams fighting their way through the projects."
Whether that sense of urgency can be developed when it comes to actually building and starting up developments remains to be seen.