* UK approved 26 incremental oil, gas projects in 2013
* New well drilling at 10-year low
* Firms to continue mature field investments in 2014
* Norway sees 40 pct rise in year-on-year drilling activity
By Karolin Schaps
LONDON, Jan 29 (Reuters) - Britain last year approved arecord number of plans to expand existing oil and gas projects,a Deloitte report said, showing the state's incentive plan tohelp squeeze maximum potential out of mature North Sea fieldswas paying off.
Britain gave the go-ahead to 26 incremental oil and gasprojects in 2013, the highest ever number of explorationextension plans on existing North Sea oil and gas fields, areport published on Wednesday by the consultancy showed.
Britain is facing a rapid decline in oil and gas production,a trend which has hit economic growth and prompted thegovernment to take action.
In 2012, it put in place tax allowances on mature fields toencourage operators to retrieve more resources from existing UKinfrastructure instead of exploring in other countries whichoffer more attractive drilling prospects.
"The introduction of the tax relief incentives by the UKgovernment, as well as the continued high oil price, hasencouraged further development and production on the UKCS (UKContinental Shelf)," Deloitte Petroleum Services said.
In line with explorers' focus on mature fields, Deloitte'sfindings also showed drilling for new wells in the UK North Seafell to a 10-year low of 47 exploration and appraisal wells.
This is 38 percent below the average number of wells spuddedeach year over the past 10 years, Deloitte said.
Developers faced a growing shortage of drilling rigs lastyear, with a 95 percent utilisation rate making it difficult forexplorers to secure equipment for new discoveries.
A total of 21 companies were active in oil and gas drillingin the UK, ranging from majors such as Shell to smallindependent firms like EnQuest, Deloitte said.
The consultancy added it expected exploration companies tocontinue their drive to expand existing projects in 2014 andbeyond as economic stability improves and commodity pricesremain high.
Norway, in contrast, saw a 40-percent rise in drillingactivity, with 59 exploration and appraisal wells spudded in2013.
The Nordic country offers a 78 percent reimbursement ofexploration costs on dry hole cases, which significantly reducesthe risk associated with drilling new exploration wells.
"This potentially explains the high number of explorationwells drilled in 2013, more than three times the number ofappraisal wells," Deloitte said.
