UK plans first North Sea oil and gas licensing round since 2020

Britain’s North Sea regulator plans to hold its first oil and gas licensing round since 2020 this year as the country struggles for more domestic energy supplies in the wake of the Ukraine war.

Andy Samuel, chief executive of the Oil and Gas Authority, told the Financial Times the regulator is preparing licenses that include existing discoveries that would be “quite operational” if oil and gas companies were willing to exploit them.

The awarding of new licenses for oil and gas drilling in UK waters will be highly controversial; Climate activists argue that the fossil fuel industry in the North Sea should be shut down and investment in clean energy technologies should be prioritized.

But Prime Minister Boris Johnson is hoping fossil fuel companies will be able to increase domestic production as it prepares to release an updated energy strategy later this month, aimed at boosting the UK’s domestic energy sources.

The UK, along with its European allies, is scrambling to phase out Russian oil and gas and reduce its exposure to highly volatile international oil and gas markets, which are driving domestic energy bills to record highs and exacerbating a cost of living crisis.

The OGA, which will change its name to the North Sea Transition Authority (NSTA) on Monday, has been unable to conduct an approval round since 2020 when the government reviewed whether its policies are consistent with climate goals.

climate capital


Where climate change meets the economy, markets and politics. Discover the coverage of the FT here.

Curious about the FT’s environmental sustainability commitments? Learn more about our science-based goals here

In the meantime, the ministers have drawn up a “climate compatibility checkpoint” at which they have promised to examine all future approval rounds. The draft text for these controls was hastily rewritten last week Include clauses that allow the government to circumvent environmental considerations in the event of pressing national security concerns.

When asked when he thinks the regulator could resume licensing, Samuel replied, “Surely this year.”

“The team [at the NSTA] are preparing some license packs containing discoveries that are pretty much done,” he said.

Samuel insisted that the content of the climate impact test and whether energy security concerns should take precedence over emissions targets is a “political matter” for the government.

However, he insisted he didn’t think the two were working “oppositely” as the UK is dependent on oil and gas imports from overseas, which are often produced at a higher cost to the environment. Last year, the UK met 40 percent of its gas needs domestically.

“We know that our good developments [in the North Sea] have a lower carbon footprint and we need them,” said Samuel.

Andy Samuel, Executive Director, Oil and Gas Authority: The team [at the NSTA] are preparing some license packages containing discoveries that are almost complete” © Ross Johnston/Newsline Media

Climate groups and some academics have questioned Johnson’s courtship fossil fuel producers Given that the North Sea is one of the most mature oil and gas basins in the world and is currently projected to recede at a rate of 5 to 7 percent annually. They also pointed out that it can take years after a reservoir is discovered to produce oil or gas.

Samuel accepted that the North Sea was a “shrinking basin” but argued that the regulator’s work to improve production efficiencies since it was set up in 2015 has helped slow the pace of the decline.

His teams re-examined a “range of possibilities,” such as B. Looking at older fields to see if some wells stopped producing when more barrels could be squeezed out, or if new wells could be drilled in those areas, he said.

Twice weekly newsletter

Energy is the world’s essential business and Energy Source is your newsletter. Every Tuesday and Thursday, Energy Source brings you breaking news, trend-setting analysis, and insider information straight to your inbox. Sign up here. UK plans first North Sea oil and gas licensing round since 2020

Adam Bradshaw

TheHitc is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – The content will be deleted within 24 hours.

Related Articles

Back to top button