Record high for North Sea licensing bids
Despite warnings of global warming, depleted reserves and calls for alternative energy sources to provide the bulk of our power, interest in developing traditional fossil fuels shows no sign of diminishing.
Applications for the UK’s latest offshore Oil and Gas Licensing Round have hit a thirty year high with firms applying for a record 279 blocks, the largest since 1972.
Three types of licences for exploration and development are being offered including the “Frontier” licence, which has sparked interest in the relatively unexplored areas North and West of the Shetlands Islands.
Energy Minister Malcolm Wicks said the high number of blocks applied for was a solid vote of confidence in the potential development of the North Sea fields.
A stewardship initiative has been set up to underpin the licensing regime and create an industry standard to ensure that firms make the most of opportunities on the continental shelf.
The aim of the stewardship is to unlock potential reserves which the government estimates at between 3 and 5 billion barrels of oil equivalent in these fields.
Malcolm Webb, chief executive of the UK Offshore Operators Association (UKOOA) said the latest round of applications offered the widest range of opportunities in many years for companies wanting to explore for new hydrocarbons.
The UKOOA estimates that the UK has up to 28 billion barrels in oil and gas reserves still to recover. However, the group warns: “We need to move quickly to extract this prize before offshore pipelines and installations are decommissioned and the opportunity to use existing infrastructure to produce this resource is lost.”
“It is vitally important for our industry’s long-term future that the UK maintains the level of interest demonstrated today and provides the business environment which will encourage further investment in new oil and gas development and production.”
A full list of applicant companies can be found on the DTI website.
By David Hopkins
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