Oil & Gas UK’s chief Malcolm Webb said investors gained confidence in developing new fields and existing ones with recent tax breaks, which would encourage investments and thereby heighten business opportunities for the country’s world-class supply chain.

Webb addressed the continued decline in production, stating, "Despite impressive investment in new developments, the production efficiency of existing assets remains in worrying decline. DECC and the industry are working to tackle this serious concern through a joint task group."

UK remained third largest gas producer and second largest oil producer in Europe last year, however its annual production declined by 14.5% to 567 million boe, or 1.54 million boe per day.

Webb added, "The industrial strategies launched by both the British and Scottish governments provide a clear framework for increased investment, innovation, growth in exports and British job creation.

"Unlocking the total economic potential of the UKCS will require both the industry and government to play their respective parts to the full."

The sector contributes £40bn (approximately $62.4bn) to the country’s economy by producing oil and gas worth £32bn ($49.9bn) and exporting oilfield technology and expertise, while production taxes add another £12bn (approximately $18.7bn), said the report.