Denmark on Wednesday awarded sixteen new offshore licenses to twelve oil and gas exploration companies.
According to the Danish Energy Agency, the companies now have six years to make new discoveries that can increase the Danish oil and gas production, and thus boost proceeds to Danish economy. This period can be extended to 30 years, for wells put into production.
The companies that obtained acreage in the latest licensing round are: Ardent Oil, Dana Petroleum. Danoil Exploration, DEA Deutsche Erdoel, DONG E & P, Dyas, Edison International, Hansa Hydrocarbons, Hess, Nordsøfonden, PA Resources and Wintershall.
The 7th Licensing Round was opened on April 24 2014, and the application period ended in October 2014. By the time the deadline ended, 25 applications had been submitted by 15 oil companies.
The areas offered for licensing comprised all unlicensed areas in the Central Graben, where the majority of Danish fields have so far been discovered, as well as areas further to the east, where oil discoveries were made in the 6th Licensing Round.
said he was happy with the results of the licensing round, especially considering the low oil price environment.
The country’s oil production is expected to decline in the coming decades, meaning less money from the sector will come to the nation’s coffers.
On that note, the minister acknowledged the importance of oil revenues from the North Sea for funding the country’s common welfare and further green transition, adding that he hoped the new license would lead to new commercial discoveries, that can maintain jobs, and revenue to the Treasury.
Licensing rounds are important
Nordsøfonden, the Danish state-owned oil and gas company managing the state participation in the majority of the licences in the Danish area, said it would invest around 200 million DKK in exploration programs first phase.
As the state’s oil and gas company Nordsøfonden is to be partner in all new licences, which means that the number of licences in Nordsøfonden’s portfolio increases from 10 to 26. With the award of licences from the 7th licensing round Nordsøfonden will be the largest licensee in Denmark in terms of area.
“Nordsøfonden looks forward to work together with the licence holders to investigate more of the Danish subsurface in order to increase the Danish reserves. The work that starts now is of great importance for both security of supply and the Danish economy,” says Director of Nordsøfonden, Peter Helmer Steen.
Looking into the future, Peter Helmer Steen said it was important to continue planning an 8th licensing round within a short period of time: “In the oil and gas industry, the time span from exploration to production is quite long. The work that starts now can be of great importance for the Danish economy and employment situation in a number of years from now. Since only a certain proportion of exploration licences lead to a commerciality agreement and later production, it is important to continuously initiate new exploration work.”
Offshore Energy Today Staff