June 22, 2024
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OIL & GAS

UK Awards 31 New North Sea Oil and Gas Exploration Licenses

On Friday, the UK’s North Sea Transition Authority (NSTA) announced the offering of an additional 31 licenses for North Sea exploration, marking the final tranche of the 33rd oil and gas licensing round.

Energy News Africa reports that over the past few months, the UK regulator has awarded a total of 82 licenses to 50 companies across three tranches of the licensing round. The first tranche, comprising 27 licenses, was offered in October 2023, followed by the second tranche, offering 24 licenses, in January 2024.

According to NSTA, the 33rd round has seen significant interest, with 115 bids submitted by 76 companies across 257 blocks and part blocks.

The licenses offered in this round are projected to contribute an estimated 600 million barrels of oil equivalent by 2060, or 545 million barrels of oil equivalent by 2050.

Notably, some of the licenses awarded today cover areas previously designated for offshore wind power licenses. NSTA highlighted the introduction of a new clause, in collaboration with partners in The Crown Estate and Crown Estate Scotland, aimed at resolving spatial overlaps between oil and gas licenses and wind leases to facilitate the co-existence of these industries.

Recognizing the North Sea’s importance for energy security and the delivery of net-zero targets, NSTA emphasized the necessity for collaboration between sectors.

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The leading industry body, Offshore Energies UK, noted that the latest license awards primarily focus on natural gas extraction from the southern North Sea, with the potential for production within the next five years. This move is expected to reduce the UK’s reliance on imported gas, which NSTA has identified as more carbon-intensive.

David Whitehouse, CEO of Offshore Energies UK, emphasized the significance of this decision in an election year, framing it as a choice between supporting a homegrown energy transition or increasing reliance on imported energy. He stressed the opportunity to boost economic growth and nurture domestic industries such as wind, hydrogen, and carbon capture.

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