The UK's North Sea Transition Authority (NSTA) launched its 33rd offshore oil and gas licensing round today, inviting applications to explore 898 blocks and part-blocks in the North Sea, which it said could lead to over 100 licences being awarded.
The NSTA reiterated that four "priority cluster areas" have been identified in the gas-rich southern North Sea — offshore Norfolk, Lincolnshire and Yorkshire — where discoveries will be fast-tracked for development. In a move to encourage the speedy development of offshore gas reserves, it will look to licence these areas ahead of others, because of their proximity to existing infrastructure.
"Applicants will be encouraged to bid for these areas so they can go into production as soon as possible," the NSTA said. The application period will close on 12 January, and the NSTA expects the first licences to be awarded from the second quarter of next year.
The southern North Sea has a number of large gas fields, supplying 25pc of the UK's domestic gas production in 2020, according to industry body Offshore Energies UK (OEUK). The basin is home to the 7.8mn m³/d Cygnus field, which has been in production since 2016. Areas in the central North Sea, the northern North Sea, west of Shetland and the East Irish Sea will also be offered for licensing.
The NSTA stressed that the new licensing round is compatible with the UK's 2050 net zero emissions goals. It said that net zero targets were secured by the climate compatibility checkpoint released in September and under which the new licences are bound, and the NSTA "rigorous full lifecycle stewardship and benchmarking".
OEUK acting chief executive Mike Tholen said this new round and other rounds are "vital" for energy security and to deliver on net zero commitments. The industry has increased gas output this year to support the UK through shortages caused by Russia's war in Ukraine, but new licences are crucial to replace declining production in the mature North Sea basin, according to Tholen.
Environmental pressure group Greenpeace said today that the new licences will not help solve the energy crisis or provide energy security in the medium term, adding that they would potentially be unlawful. "We will be carefully examining opportunities to take action," the group said. Earlier this year it launched a legal challenge against the development of the Jackdaw gas and condensate field in the UK North Sea, and sought permission from the UK Supreme Court to challenge BP's permit to extract oil from the Vorlich field.
OEUK said that if new gas resources were discovered "they could reduce UK imports but would make little difference to the UK's energy consumption or its production of greenhouse gases".
"Such emissions are driven largely by the UK's infrastructure such as the 24mn homes heated by gas boilers, the 32mn cars running on [gasoline] and diesel, or the 30-plus power gas-fired power stations that produce two-fifths of our electricity," OEUK said.
Environmental groups have long complained that the government is not doing enough to reduce hydrocarbon demand through energy efficiency. "Supporting the oil and gas giants profiteering from the energy and climate crises ignores the speedy solutions that are best for the economy, for lowering bills and for the climate, Greenpeace said today, referring to domestic insulation, which it said is the faster and cheapest way to reduce energy bills and CO2 emissions. "Experts have repeatedly made clear that we need warmer, energy efficient homes, and a big push for cheap, homegrown, renewable power," Greenpeace said.
