UK: OGA to award four offshore licenses in Buchan area to three operators

UK’s oil and gas regulator, the Oil and Gas Authority (OGA), has offered for award four licenses to three companies in the 2019 31st Supplementary Offshore Licensing Round, which closed for applications in May 2019.

Great Buchan area map
Great Buchan area map; Source: OGA

The regulator announced its plan to maximize economic recovery from the Greater Buchan area of the North Sea in October 2018.

Eleven blocks were originally on offer in this Supplementary Round, which was focused in the Greater Buchan Area of the UK Continental Shelf (UKCS).

This was the first time the OGA has linked a license round offer with an Area Plan and the application process included the requirement for applicants to demonstrate their wider area plan development concepts and to seek to collaborate with other area licensees and applicants.

OGA said on Monday that the round offered blocks under flexible terms, enabling applicants to define a license duration and phasing that will allow them to execute the optimal MER UK work program.

In all, four applications covering five blocks were received and the OGA is now ready to make offers of award in respect of four licenses covering the five blocks.

Potential block awards will go to Jersey Oil & Gas for blocks 20/4c and 20/5d & 21/1a, Decipher Developments for block 21/2a, and Talon and its partner One-Dyas for block 014/30b.

Two of the awards are for work programs that will proceed straight to Second Term, either for potential developments, or re-developments of fields where production had ceased and the acreage had been relinquished. The remainder of the licenses will enter the Initial Term (exploration stage).

As reported earlier on Monday, the new Greater Buchan Area (GBA) acreage provides Jersey Oil & Gas with a significant opportunity to potentially establish and operate a future major new area development to access more than 100 mmboe of discovered mean resources plus in excess of 300 mmboe of identified mean prospective resources that are estimated to be present in the GBA.

Scott Robertson, CNS Area manager, said: “From bringing together interested parties at an early stage to releasing extensive digital data in advance of the license round, the OGA sought to facilitate a common understanding and industry collaboration. The resulting commendable level of engagement between operators and high quality applications enabled us to make awards confident that the right assets are going to be in the right hands to deliver the optimal MER development of the Greater Buchan area. We look forward to working with the awardees as they deliver on their work programs and commitments and to exploit the opportunities to re-purpose and sustain existing infrastructure.”

The OGA fully supports the transition to a low carbon economy. Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future, and maximizing economic recovery from the UKCS is therefore vital to meet our energy demands and reduce reliance on imports.

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