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Released October 17, 2022 | GALWAY, IRELAND
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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--The U.K. government has announced a massive new oil and gas licensing round in the North Sea as it seeks to secure future energy supplies in light of Russia's ongoing war with Ukraine.
The new round announced by the North Sea Transition Authority (NSTA) is offering almost 900 locations in the North Sea which may lead to over 100 licenses being awarded. The NSTA has identified four priority cluster areas in the Southern North Sea, which it said "have known hydrocarbons, are close to infrastructure and have the potential to be developed quickly." It will seek to fast-track licensing these areas ahead of others. The average time between discovery and first production is close to five years and falling, according to its own analysis, but it hopes some areas could be producing in 12-18 months. It marks a dramatic U-turn by the new U.K. Prime Minister, Liz Truss, and flies in the face of the advice given by her own climate advisers to accelerate the move away from fossil-fuels to renewables in order to achieve long-term energy security.
"Putin's illegal invasion of Ukraine means it is now more important than ever that we make the most of our sovereign energy resources, strengthening our energy security now and into the future," said new U.K. Business and Energy Secretary Jacob Rees-Mogg at the licensing launch. "Ensuring our energy independence means exploiting the full potential of our North Sea assets to boost domestic production--recognising that producing gas in the U.K. has a lower carbon footprint than importing from abroad."
Dr. Andy Samuel, NSTA chief executive, said: "The NSTA is working closely with industry and government to meet U.K. needs with North Sea supplies produced as cleanly as possible. The U.K. is forecast to continue importing natural gas as we transition to a fully renewables system and our North Sea gas has less than half the footprint of imported LNG. This licensing round includes gas discoveries in the Southern North Sea which can be rapidly tied back to existing infrastructure. All developments undergo environmental and emissions assessments. As with good safety leadership, good environmental performance is good business. For example, we worked with industry to cut flaring again in 2021 by 20%, saving enough gas for 130,000 U.K. homes. Security of supply and net zero should not be in conflict. The industry has committed to halving upstream emissions by 2030 and investing heavily in electrification, carbon storage and hydrogen. Signs are promising so far--our first carbon storage round closed last month with 26 applications from 19 companies across all the areas we offered."
The U.K.'s oil and gas resources have fallen sharply in recent decades, but there are some notable projects on the horizon. In 2021, the U.K. only produced 57% of the volumes required to meet oil demand and 41% of national gas demand. Earlier this year, Industrial Info reported on the final investment decision by Shell Plc (NYSE:SHEL) (London, England) for the Jackdaw field development, located approximately 275 kilometers (km) east of Aberdeen in the central North Sea. Shell estimates that the field has reserves of between 120 million and 250 million barrels of oil equivalent. At its peak, Jackdaw is expected to produce 6.5% of the U.K's total gas needs, enough to heat 1.4 million homes. For additional information, see June 14, 2022, article - U.K. Greenlights Jackdaw Oil and Gas Project.
In August, Norway's energy major Equinor (NYSE:EQNR) (Stavanger) submitted environmental plans for one of the U.K.'s largest untapped oil and gas projects--Rosebank--located west of the Shetland Islands. It lies around 130 km northwest of Shetland and is estimated to contain up to 300 million barrels of recoverable oil, according to industry estimates. Planned commissioning is 2026 through to 2030, and it has the potential to account for 8% of the U.K.'s oil production. For additional information, see August 16, 2022, article - Equinor Advances Rosebank Oil & Gas Project in the U.K..
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The new round announced by the North Sea Transition Authority (NSTA) is offering almost 900 locations in the North Sea which may lead to over 100 licenses being awarded. The NSTA has identified four priority cluster areas in the Southern North Sea, which it said "have known hydrocarbons, are close to infrastructure and have the potential to be developed quickly." It will seek to fast-track licensing these areas ahead of others. The average time between discovery and first production is close to five years and falling, according to its own analysis, but it hopes some areas could be producing in 12-18 months. It marks a dramatic U-turn by the new U.K. Prime Minister, Liz Truss, and flies in the face of the advice given by her own climate advisers to accelerate the move away from fossil-fuels to renewables in order to achieve long-term energy security.
"Putin's illegal invasion of Ukraine means it is now more important than ever that we make the most of our sovereign energy resources, strengthening our energy security now and into the future," said new U.K. Business and Energy Secretary Jacob Rees-Mogg at the licensing launch. "Ensuring our energy independence means exploiting the full potential of our North Sea assets to boost domestic production--recognising that producing gas in the U.K. has a lower carbon footprint than importing from abroad."
Dr. Andy Samuel, NSTA chief executive, said: "The NSTA is working closely with industry and government to meet U.K. needs with North Sea supplies produced as cleanly as possible. The U.K. is forecast to continue importing natural gas as we transition to a fully renewables system and our North Sea gas has less than half the footprint of imported LNG. This licensing round includes gas discoveries in the Southern North Sea which can be rapidly tied back to existing infrastructure. All developments undergo environmental and emissions assessments. As with good safety leadership, good environmental performance is good business. For example, we worked with industry to cut flaring again in 2021 by 20%, saving enough gas for 130,000 U.K. homes. Security of supply and net zero should not be in conflict. The industry has committed to halving upstream emissions by 2030 and investing heavily in electrification, carbon storage and hydrogen. Signs are promising so far--our first carbon storage round closed last month with 26 applications from 19 companies across all the areas we offered."
The U.K.'s oil and gas resources have fallen sharply in recent decades, but there are some notable projects on the horizon. In 2021, the U.K. only produced 57% of the volumes required to meet oil demand and 41% of national gas demand. Earlier this year, Industrial Info reported on the final investment decision by Shell Plc (NYSE:SHEL) (London, England) for the Jackdaw field development, located approximately 275 kilometers (km) east of Aberdeen in the central North Sea. Shell estimates that the field has reserves of between 120 million and 250 million barrels of oil equivalent. At its peak, Jackdaw is expected to produce 6.5% of the U.K's total gas needs, enough to heat 1.4 million homes. For additional information, see June 14, 2022, article - U.K. Greenlights Jackdaw Oil and Gas Project.
In August, Norway's energy major Equinor (NYSE:EQNR) (Stavanger) submitted environmental plans for one of the U.K.'s largest untapped oil and gas projects--Rosebank--located west of the Shetland Islands. It lies around 130 km northwest of Shetland and is estimated to contain up to 300 million barrels of recoverable oil, according to industry estimates. Planned commissioning is 2026 through to 2030, and it has the potential to account for 8% of the U.K.'s oil production. For additional information, see August 16, 2022, article - Equinor Advances Rosebank Oil & Gas Project in the U.K..
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
