Following the announcement of the 26th UKCS Licensing Round, UKCS consultancy Hannon Westwood today released an updated study on the potential resource opportunity offered. The Round includes the largest number of blocks of any UKCS licensing round and has the potential to add 800 mmboe through discoveries and 35 billion boe through prospects to the UKCS asset resource.
The study details the exploration and discovery potential in the unlicensed acreage on offer in the 26th Round, and reveals the following:
• 80+ Discoveries in unlicensed acreage
• Gross unrisked estimated potential reserves of 800 mmboe
• 750+ Prospects
• Estimated unrisked potential reserves of 35 billion boe
The Study includes information on all unlicensed Blocks and part-Blocks available for licensing, where potential has been previously mapped.
A large number of recent relinquishments have been from within the proven play fairways, increasing the potential for relatively low risk opportunities in the Round.
Chris Bulley, Executive Director, Hannon Westwood comments:
'The Government has largely completed its SEA process and the whole UKCS, apart from West of Rockall, is now available for licensing. While the Round includes a number of areas that have historically been perceived as non-prospective, the wide extent now offered allows free rein to explorers with new ideas. For example, can the potential of the SW Approaches now be realised?
The new Field Allowance regime should also provide some boost to the smaller or more difficult developments. However the gas potential in both the Southern North Sea and West of Shetlands could benefit from a strengthening of the gas price. Improvements in the fiscal regime to improve the economics of gas projects are particularly important to allow the development of marginal gas discoveries before the ageing Southern North Sea infrastructure is decommissioned.'
Charles Westwood, Founding Partner, Hannon Westwood adds:
'We speculate that the existing majors and super-majors will make only very selective applications in existing core areas and possibly in the West of Shetlands and Central North Sea HPHT basins.
However there is likely to be a good response to the Round from the independents and utilities as they seek to expand their core areas and also develop new hubs. It might be a tougher Round for the smaller independents and Promote companies. The availability of finance is likely to remain an issue and the Government is looking more closely at the financial capability of some of the smaller companies.'
Hannon Westwood holds and maintains an extensive Discovery and Prospect database on the UKCS with over 450 undeveloped discoveries and over 1,650 undrilled prospects.