Monday 31 October 2016

The UK’s latest offshore licensing round – targeting under-explored and frontier areas - has attracted 29 applications covering 113 blocks, the Oil & Gas Authority (OGA) said on Monday.

Applications for acreage in the Rockall Trough, Mid North Sea High areas and the East Shetland platform were received from 24 companies, ranging from multi-nationals to new country entrants, according to the authority.

Some of the proposed work programmes include firm commitments to drill wells.

The OGA will now begin technical evaluation of the bids and will work towards making awards “as early as possible in 2017”.

The number of blocks applied for was less than 10% of the 1261 offered when the round -- the 29th since UK licensing began -- launched on 27 July.

However, OGA chief executive Andy Samuel said he was pleased with the uptake, pointing out this year’s round was the first in two decades to focus solely on frontier areas.

Samuel said: “Despite the difficult climate, industry has responded strongly to our offer, using analysis and insights to identify new prospects and submit high-quality applications on blocks that did not attract interest in recent licensing rounds. This confirms the high remaining potential in the UKCS’ frontier areas.

“Long-standing investors continue to seek new acreage and we also welcome the arrival of new entrants.”

The round closed for applications on 26 October.

The areas offered in this round were covered by new seismic data acquired and funded by the UK government under a new initiative to boost flagging exploration levels.

Operators have also been able to apply for a new type of licence, called the Innovate Licence, designed by the OGA to give operators greater flexibility around their work programme.

The previous 28th Round was launched on 24 January 2014 when oil was still trading at about $100 per barrel. It attracted a total of 173 applications.

A total of 175 licences were eventually awarded covering 353 blocks, making it one of the largest rounds in the five decades since the first UK North Sea licensing round took place in 1964.

The upcoming 30th Round will cover mature areas of the UKCS, including some blocks not available since the 3rd Licensing Round, held in 1970.