Licensing Round Opens All Areas in UK Waters

A new round of offshore licensing will give a further boost to the UK's offshore oil and gas industy, Energy and Climate Change Minister Lord Hunt announced on January 27. Lord Hunt was in Fife visiting an oil platform manufacturing yard as he launched the 26th offshore licensing round to allow for oil and gas exploration in UK waters.

For the first time since 1998, this round also offers blocks in all areas of the UK seas for new licensing.

The blocks offered include a number relinquished under the Government and industry's "Fallow Initiative," which stimulates activity on blocks where there had been no significant activity for three years.

Lord Hunt said, "This record-breaking 26th Round includes areas of the Continental Shelf not as yet explored, and will provide a new boost to activity in the basin.

"The round will help to secure the future of the UK's oil and gas industry which still provides three quarters of our energy needs and some 350,000 jobs.

"Estimates suggest there are still around 20 billion barrels of oil equivalent, or possibly more, to be produced, and this latest licensing round will help ensure we realize this potential.

"As we make the transition to a low carbon future, we must ensure we have secure energy supplies by making the best use of our indigenous energy resources in a safe and environmentally sound way."

Fourteen blocks that were classified as "fallow" in 2009 have either been fully, or partly, relinquished in time to be on offer in this round.
In addition, the majority of areas licensed in the 1st Round in 1964 that have not been allowed extensions have been relinquished and are included for offer in the 26th Round.

The Government has also introduced a new Frontier license with an extended nine year exploration term for the West of Scotland area, which aims to encourage oil and gas exploration in an area in which geological data is as yet scant.

In deciding which areas to offer for licensing, DECC conducted a thorough Strategic Environmental Assessment (SEA) of UK waters. DECC has accepted the SEA's recommendations that licensing may proceed subject to some areas being withheld from licensing for the moment due to lack of information.

Before any license awards are made, an environmental assessment under the Habitats Directive will be carried out.

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