BP PLC's (BP) oil and gas production business in the U.K. North Sea is unsustainable at current low oil prices and high costs, a spokeswoman for the company said Tuesday.
The company, which is one of the largest producers of oil and gas in the North Sea, needs to act quickly to make sure it can continue investment in business, she said.
BP has opened talks with key contractors and suppliers about reducing costs. The talks are still at an early stage but BP is looking for a quick response from oil service companies, she said. "Doing nothing is not an option," she said.
The cost of developing and running oil and gas fields in the North Sea has increased 50% since 2004, but the oil price is now back at 2004 levels, she said. "Broadly the business is not sustainable."
The company has no plans to recruit extra workers into its North Sea operations this year, but will continue graduate and trainees programs, she said.