UK hands out 144 licences for oil and gas

 
City A.M. Reporter
BRITAIN has granted 144 oil and gas exploration licenses in its 26th licensing round, but plans a more thorough investigation into the environmental impacts of 45 other prospective licences, the government said yesterday.

The licences cover 268 blocks, almost as many as the 303 awarded in the previous licensing round.

Seven of the 83 companies that were offered licenses are new explorers to the UK Continental Shelf.

“It’s encouraging to see the healthy level of interest there is from industry to make the most of the UK’s still substantial resources of oil and gas,” energy minister Charles Hendry said.

“While in the long term, we want to decarbonise our energy system, we have moved swiftly to offer these licences as we must realise the optimum value from the UK’s energy resources and ensure secure energy supplies.”

Britain launched its 26th offshore oil and gas licensing round in January, offering blocks in all its territorial waters for the first time in 12 years as well as tax incentives to explore some deepwater areas for natural gas.

Britain’s oil and gas output has been in decline over the last few years and the government expects oil and gas production to fall by more than a quarter from 2009 to 2015 – unless the decline can be stemmed by new finds.

It estimates there could still be over 20bn barrels of oil equivalent in UK waters, and hopes the latest licensing round will help get it out.

The tax breaks could make tricky deep-sea natural gas prospects more economically attractive, which could help producers stem the steady decline in Britain’s own gas output from easier-to-reach fields.