Competition and Markets Authority flags concerns in North Sea oil and gas

 
Jessica Morris
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(FILES) File Photo taken in the North Se
North sea oil and gas has struggled amid falling prices (Source: Getty)

The UK's competition watchdog has written to the government flagging competition concerns in the UK's north sea oil and gas industry.

The Competition Markets Authority said government plans to establish the Oil and Gas Authority as an independent regulator for the North Sea oil and gas market could facilitate information exchanges which would ultimately harm competition with the sector.

Alex Chisholm, chief executive of the CMA, wrote in a letter to energy secretary Amber Rudd that, while the watchdog recognises it isn’t the government’s intention to do this, “the combination of a number of the powers and obligations of the Oil and Gas Authority gives rise to the risk that circumstances conducive to undesirable exchange of sensitive information among them could arise".

Read more: Rocketing oil and gas production masks weak underlying trend in industrial production

It's been a particularly tough 18 months for North Sea oil and gas companies, which have suffered as oil prices fell from over $100 per barrel in June last year to around $50 per barrel today.

The changes are part of the government's energy bill which is currently making its way through parliament.

One of its provisions is the establishment of the OGA as an independent regulator which is responsible for asset stewardship and regulator of domestic and gas operations.

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