RECENT moves by oil giants have provided further indications that big changes are under way in the industry which campaigners may welcome but raise fresh questions about the future of the North Sea.

However, an unfamiliar name has provided a reason to think that the outlook for the area may be set to improve amid the gloom resulting from the slump in oil and gas prices triggered by the coronavirus.

After a series of firms announced plans for spending cuts in the North Sea, Royal Dutch Shell last week provided a fresh sign the fall in prices has posed tough strategic questions by announcing it expected to record massive impairment charges in its second- quarter results.

The Anglo-Dutch giant said it planned to slash the valuation of its oil and gas assets by up to $22 billion (£17.9bn) to reflect the expected impact of the Covid-19 coronavirus pandemic on demand and the wider economy.

READ MORE: Shetland finds may contain much less oil and gas than hoped for

The write-offs are based on the judgement that oil and gas assets are going to be worth much less than expected in future following a dramatic deterioration in the outlook for commodity prices as a result of the coronavirus

Shell expects the Brent crude price to average just $35 per barrel in 2020 compared with $60/bbl previously. It reckons the price will average $40/bbl in 2021 and $50/bbl in 2022, down from a forecast of $60/bbl for both years.

The write-offs suggest Shell has cooled on a range of exploration prospects and finds that once generated excitement.

The company announced them weeks after causing a stir by revealing it planned to cut its dividend for the first time since the Second World War.

Chief executive Ben van Beurden said the dividend cut would help ensure Shell retained the firepower to make the investment in renewable energy that would help power growth in future.

READ MORE: Oil giant Shell announces plan to become net zero business

Shell declared its ambition to become a net zero business in terms of carbon emissions by 2050 in April.

Against that backdrop, while Shell made no reference to the North Sea when announcing the impairments, the news of the valuation cuts could raise fresh questions about the outlook for its operations in the area.

It previously unveiled plans for multi-billion dollar cuts in overheads and spending which will impact on operations around the world.

With the company focusing its investment on bumper projects, the North Sea competes ever harder for attention with other basins in which operating costs are cheaper.

Shell’s write-off announcement came weeks after its giant rival BP said it would cut the valuation of its global oil and gas portfolio by up to $17.5bn.

READ MORE: BP strikes $5bn deal to sell petrochemicals division to Grangemouth refinery owner

Last week BP provided a further sign that the fallout from the coronavirus is encouraging a big shake-up at the company when it unveiled plans to sell its petrochemicals business to Grangemouth refinery owner Ineos for $5bn. The division owns a huge complex on Humberside.

Oil and gas giants have long used ownership of downstream assets to help hedge against the impact of falls in the prices of the source commodities they produce.

BP chief executive Bernard Looney said the sale of the petrochemicals business was another deliberate step in building a company that could compete and succeed through the energy transition.

The company intends to increase investment in sectors such as renewable energy under Mr Looney’s plan for it to become a net zero business by 2050.

Sceptics may feel the petrochemicals disposal probably had as much to do with bolstering BP’s balance sheet to help the company cope with tough times in the oil and gas business at it did with investing in a green future.

Whatever, it makes clear that oil and gas is going to become a less significant part of BP’s business in coming years.

While BP has underlined its commitment to the North Sea in recent months, the petrochemicals sale may fuel concerns that it is likely to cut investment in oil and gas fields in the area.

READ MORE: Glasgow-born oil executive to take charge of BP's North Sea business

Sector-watchers will be wondering what the new boss of BP’s North Sea business, Emeka Emembolu, will see as his priorities.

The Glasgow-born executive took over last week from Ariel Flores who made clear he saw lots of potential in the West of Shetland area in which BP has invested heavily in recent years.

Environmental campaigners have welcomed the signs that BP and Shell’s enthusiasm for oil and gas is waning but want both to provide much more detail about their plans to invest in renewables.

The fear among champions of the North Sea oil industry will be that Shell and BP run their existing businesses in the area for cash, with an increasingly tight focus on costs.

Both shed jobs and sold off assets deemed non-core in the North Sea amid the downturn that followed the sharp fall in the oil price from 2014 to 2016.

They may be ready to sell more assets if buyers could be found. However bidders for significant North Sea assets may be in short supply.

BP had to accept significant changes to a $625m deal agreed with Premier Oil in January to persuade the company to press on with it. Last week Premier pulled out of a $250m deal to buy an additional stake in the Tolmount field from Dana Petroleum, which it had agreed in January.

However, signs that interest may be stirring in the North Sea came from an unexpected quarter on Monday.

READ MORE: £250m takeover provides major vote of confidence in North Sea amid coronavirus crisis

A new player emerged in the form of a London-based energy trading business that clinched a deal to buy North Sea-focused RockRose Energy for around £250m in cash.

The business, Viaro Energy, is led by an Italian entrepreneur, Francesco Mazzagatti.

Viaro had been hunting for North Sea deals since last year and approached RockRose in February.

While Viaro may have been able to negotiate a better deal following the subsequent oil price fall, its 1850p per share offer was pitched at a significant premium to RockRose’s share price.

Viaro made clear it sees RockRose as a platform for growth in the North Sea. Significantly Viaro secured financing for the deal from investors based in Abu Dhabi.

READ MORE: North Sea oil and gas firm eyes big acquisitions despite crude price slump

Viaro’s move will encourage hopes that newcomers could help kick start North Sea activity as some did during the downturn triggered by the oil price fall between 2014 and 2016. RockRose was founded in 2015 by a former investment banker, Andrew Austin, who felt the slump would create opportunities to buy assets at attractive prices.

The Viaro deal values Mr Austin’s stake in RockRose at around £70m. Others may decide now is the time to try to repeat the success he has enjoyed.