One of the biggest North Sea licencing rounds ever, the 28th, has resulted in 134 licences covering 252 blocks being awarded by the Department of Energy and Climate Change.
The licences give the holders the right to explore for oil and gas on the UK Continental Shelf. More than 60 companies applied for licences, which is seen as an encouraging sign that interest in the UK sector remains high despite the backdrop of falling oil prices.
Oonagh Werngren, operations director of industry body Oil & Gas UK, said: “While the number of licences is less than the record number of applications in the 27th licensing round, this news is a good sign that investors continue to show interest in the basin.”
Ms Werngren said that most of the applications came from smaller companies and only five firm wells and four contingent wells were included in the licensing. She added:” Most licences have been awarded on the basis of obtaining or reprocessing 2D and 3D seismic data. The disappointingly low number of wells highlights the need to stimulate new plays through detailed technical work which requires measures to encourage more investment in the UKCS.”
Oil and Gas UK was encouraged to see companies looking at ‘frontier’ areas, away from the known basins and into deeper water that technical developments could make viable. Areas of special protection or conservation are either in or close to 94 of the blocks and Oil & Gas UK has urged the government to carry out environmental assessments urgently so there is no delay to any oil or gas finds coming on stream.
Business and Energy Minister Matthew Hancock said: “This successful licensing round, which is on track to be one of biggest rounds ever in five decades, is a boost for the UK economy and shows that our long term economic plan is working. We are creating more jobs by backing business with better infrastructure investment. Industry are scrambling over themselves invest in the UK and explore for energy.”