LONDON (Dow Jones Newswires), Oct. 27, 2010
The U.K. government announced the results of its 26th offshore oil and gas licensing round, including the appointment of licenses in the "critical" area west of the Shetlands.
The relatively unexplored deep waters offshore the Shetland Islands are thought to hold nearly 20% of the U.K.'s remaining oil and gas reserves and are expected to receive billions of pounds in investment.
"The West Shetlands are absolutely critical to the U.K.'s national energy needs," U.K. Energy Minister Charles Hendry told Dow Jones Newswires, adding that the development of infrastructure in the region represented a particularly important area of growth for British industry.
The government offered a total 144 licenses to various companies to extract oil and gas in 268 blocks in U.K. waters, close to the historic high of 192 licenses awarded over 303 blocks in 2009.The offers came after the oil companies filed bids with the U.K. for the tracts.
The companies have yet to say formally if they accept the licenses.
"It's encouraging to see the healthy level of interest there is from industry to make the most of the U.K.'s still-substantial resources of oil and gas," said Hendry.
"Whilst in the long-term, we want to decarbonize our energy system, we have moved swiftly to offer these licenses as we must realize the optimum value from the U.K.'s energy resources and ensure secure energy supplies," he said.
The U.K.'s Department of Energy and Climate Change has decided that 99 further blocks, comprised in 45 prospective licenses, should be subject to more detailed assessments of the likely effects of oil and gas activities on certain protected nature conservation areas.
A decision on whether to grant licenses for these blocks will be subject to the results of environmental assessments.
Licenses have been offered to BP, ConocoPhillips, ExxonMobil, Total, Shell, Dana Petroleum, Apache Corp. and others.
Copyright (c) 2010 Dow Jones & Company, Inc.
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