The burgeoning subsea industry, which is worth more than £3.5bn a year to the UK, is being forced to go abroad to recruit because of a shortage of skilled personnel.

Revenue from the industry, which directly employs 30,000 people, is growing at almost 25% a year and Scotland is a global leader for subsea technology.

There are potentially hundreds of jobs which could be created, but there are fears that if companies have to look for greater numbers of staff overseas then they could move their bases from Scotland.

A seminar was held in Aberdeen yesterday organised by Oil & Gas UK and the Industry Technology Facilitator in a bid to highlight the need to attract highly-skilled staff and to focus on the issues which need to be addressed to ensure the UK maintains and extends its lead in the subsea oil and gas sector.

Paul Dymond, Oil & Gas UK's operations director, said: "Subsea is key to unlocking the full potential of the United Kingdom Continental Shelf. Nearly 40% of production is already as a result of the subsea technology we have developed and that is increasing as we have smaller fields.

"We have to find ways of developing economically the smaller pools of reserves, and subsea technology is key to that.

"We need to be able to attract new blood from universities. This is an attractive industry. There is high investment, it is hi-tech and comparable to the aerospace industry but it gets very little airing.

"We have an opportunity here which should attract the cream of engineering science coming out of our universities. It is a challenging, interesting, hi-tech industry.

"The North Sea will go for a long time yet. 2035 is a rather conservative estimate of when things might start slowing down and that is a long time, a whole career worth, but in addition there are overseas opportunities from this base and there is also renewables and other spin-offs.

l THE decline in oil and gas production in the North Sea continued through May with a fall of 14% year-on-year - in spite of near-record investment in 2006.

Moreover, monthly production fell 5% in March, after it increased during five of the previous six months.

Andrew McLaughlin, chief economist at Royal Bank of Scotland, said: Despite increased drilling activity, the underlying long-term decline in production is unlikely to be reversed."

Meanwhile, crude oil prices have been driven higher in recent weeks, averaging in the mid-$60s. McLaughlin said most noteworthy during the latest run-up in prices is the widening premium of Brent over West Texas Intermediate.