Oil and Gas Authority announces new UK onshore oil and gas licences offered

Monday, March 7, 2016      

The Oil & Gas Authority (OGA) - the UK's oil and gas regulator - has today announced that 159 onshore blocks under the 14th Onshore Oil and Gas Licensing Round are being formally offered to successful applicants. These blocks will be incorporated into 93 onshore licences.

A Petroleum Exploration and Development Licence (PEDL) does not itself give any direct permission for operations to begin. A PEDL grants the licensee exclusivity over an area of land for onshore hydrocarbon exploration, appraisal and extraction. The exclusivity applies to both conventional and unconventional operations.

The UK has a long history of onshore gas exploration, and has developed a robust regulatory system to ensure that any such operations will be carried out to the highest standards of safety and environmental protection. Before a PEDL licensee can begin operations (such as drilling, hydraulic fracturing or production) they must be granted a number of further permissions and consents. These include, for example, planning permission, environmental permits from the Environment Agency, scrutiny of well design by the Health and Safety Executive, and OGA consents under the terms of the PEDL.

Around 75% of the 159 blocks being offered today relate to unconventional shale oil or gas, and additional regulatory requirements apply to this kind of activity.

The offer of PEDLs today follows a detailed environmental assessment of the proposed blocks under the Conservation of Habitats and Species Regulations 2010, which was subject to public consultation. The OGA is today also publishing its updated Habitats assessment report, and its response to the consultation. Following this assessment, and the conclusion of the consultation process, the OGA is satisfied that the approval of the 14th licensing round, and the offer and eventual award of the individual PEDLs, will not have an adverse effect on the integrity of any protected European site.

OGA Chief Executive Andy Samuel said:

'I am pleased that the 14th Onshore Round attracted strong interest and a high quality of proposed work programmes. This round enables a significant amount of the UK's shale prospects to be taken forward to be explored and tested.

'Upon acceptance of these offers, applicants will be issued with licences and will be able to begin planning their future strategies for exploration activities. These will be subject to further local planning, safety, environmental and other authorisations.'

Energy Minister Andrea Leadsom said:

'Last month we set out the vital role gas will play in the UK's transition to a low-carbon future. The licences offered today move us a step closer - driving forwards this industry which will provide secure, home grown energy to hardworking families and businesses for decades to come.

'Alongside conventional drilling sites, we need to get shale gas moving. As the Task Force for Shale Gas report found earlier this week, with the right standards in place fracking can take place safely. Now is the time to press ahead and get exploration underway so that we can determine how much shale gas there is and how much we can use.'

Oonagh Werngren, Oil & Gas UK's operations director, said:

'We welcome the Oil and Gas Authority's initiative in hosting a competition to analyse data from geophysical surveys of the Rockall Trough and Mid-North Sea High. This Exploration Licence competition provides the industry with a valuable opportunity to both develop new perspectives on key areas of the UK Continental Shelf and re-evaluate how we can use data to more efficiently to unlock the remaining exploration targets. By launching the competition, the Oil and Gas Authority is promoting the opportunity for innovative companies to showcase their potential to maximise value from the survey and help efforts to stimulate further exploration activity in the UK.'


Article Tags

United Kingdom West Europe Licencing Round Fracking North Sea Shale Gas Unconventionals

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser. More

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