North Sea operators plan to move ahead with 22 projects in the coming years, which, subject to robust emissions controls, would target 1.5 billion barrels, the North Sea Transition Authority (NSTA) said in a statement recently published on his site.
In the statement, the NSTA noted that seven projects capable of producing almost 100 million barrels and requiring about $1.3 billion (GBP 1.1 billion) of expenditure have been approved by the NSTA since the beginning of the last year, stressing that these “can significantly increase the UK’s security of supply as we make the transition, once production starts”.
The figures, which the NSTA says highlight the scale of remaining potential in the North Sea, were presented to the CEOs of the 22 largest North Sea operators at the annual zero-level performance review meeting, highlighted the organization In its statement, the NSTA noted that the main North Sea energy operators had met to discuss future opportunities and receive clear messages about energy security, reducing emissions and the importance of accelerating the transition.
“From zero last year, the NSTA challenged operators to recover their production efficiency after a drop of seven percentage points to 73 percent by 2021 amid widespread maintenance shutdowns,” said the NSTA in a press release from the organization.
“Encouragingly, production efficiency, which indicates how well companies are using their assets, increased to 78 percent by 2022. The NSTA will continue to work with operators to help them restore it to the target long-term 80 percent,” he added.
“The industry was praised for recent emissions reductions, including flaring, which has been halved since 2018,” the NSTA continued.
The NSTA noted that these reductions are expected to continue, “with companies highlighting dozens of plans to improve energy efficiency and reduce torsion.” He added, however, that operators must do more if they are to meet the NSTA’s expectation of eliminating routine twisting and venting by 2030.
“Operators must also invest in powering their rigs with clean electricity to meet and exceed the North Sea Transition Agreement’s target of reducing global production emissions by 50 percent by 2030 and preserve its social license to operate,” the NSTA said.
Reuse, carbon storage awards
In addition, options are being identified to reuse and repurpose oil and gas infrastructure for low-carbon projects, such as hydrogen and carbon storage, the NSTA announced. The organization also said it will soon give further impetus to the transition by announcing the awards for the first round of UK carbon storage licences, which it noted received 26 bids from 19 companies.
“The North Sea has a wide range of oil and gas, wind and storage resources that can secure the UK’s clean energy supply, rapidly reduce its greenhouse gas emissions and support hundreds of thousands of skilled jobs,” said NSTA CEO Stuart. Payne said in a statement from the organization.
“The NSTA will lead efforts to integrate these resources, optimizing their enormous potential,” he added.
Rigzone has contacted industry body Offshore Energies UK (OEUK) for comment on the latest NSTA update. At the time of writing, Rigzone has yet to receive a response.
In April 2022, the NSTA noted that the annual performance review of the UK’s top producers highlighted 33 new projects targeting 1.3 billion barrels of oil and gas, which the organization said will “significantly strengthen the energy security of the country”.
“A total of 890 million barrels of these resources could be sanctioned as early as next year and the North Sea Transitional Authority expects operators to deliver projects quickly, in line with its effective net zero test , in the interests of UK supply resilience.” NSTA said in a statement from the organization at the time.
NSTA moves to accelerate North Sea oil and gas production
In a statement posted on its site in March, the NSTA announced it had moved to speed up North Sea oil and gas production by proposing the removal of barriers to investment.
“The NSTA is determined to assist the industry in its role of ensuring the security of the national energy supply and has opened a consultation on new guidelines which aim to streamline the buying and selling of assets,” the NSTA said in a press release from the organization at the time.
“Operators and licensees concerned about transaction delays that can damage labor relations, increase costs and delay operational and strategic decisions asked the NSTA to look into the situation,” he added.
“The NSTA heard from licensees and potential investors who have been frustrated by challenges encountered during or because of license allocations,” he continued.
In the statement, the NSTA noted that the concerns relate to issues such as the slowdown in operational activities and capital projects, blocked transactions that have a knock-on effect on North Sea production, concerns about the ‘exposure to decommissioning costs that delay deals and excessive binding coventurer requirements. – capital that could be used productively elsewhere in the basin.
“The consultation will address these and other related issues,” the NSTA said in the statement.
“It will allow licensees and investors to share their thoughts on issues such as how best to strike a balance between market liquidity and preserving investor confidence, the role of self-regulation and what should ‘include the NSTA’s guidance on license allocations,’ he added.
The consultation will be open until May 23. A new guide is expected to be published later this year.
“The UKCS has a rich history of successfully welcoming new investors to the basin,” NSTA director of regulation Jane de Lozey said in a statement from the organization at the time.
“These investors have brought new capital, new ideas and new vigor; the NSTA wants this to continue to support the UK’s need for energy security,” de Lozey added.
“Some transactions have been delayed or even jeopardized because buyers and sellers have not engaged with joint venture partners early enough and the new guidance will provide clear actions to take and when to them, to ensure that production is maximized,” de Lozey continued.
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