New UK onshore shale gas exploration licences awarded in (England-only) ‘gold rush’

The winning 'strikes' in the latest UK onshore oil and gas licensing round
The winning ‘strikes’ in the latest UK onshore oil and gas licensing round. The ‘pale’ green blocks are the 27 which will be licensed for exploration – mostly in North East and North West England and Yorkshire.

The Aberdeen-based Oil & Gas Authority (OGA) – the industry’s UK regulator – has confirmed that a total of 27 blocks from the 14th Onshore Oil and Gas Licensing Round will now be formally offered to the successful bidders.

A total of 95 applications were received from 47 oil and gas companies covering 295 Ordnance Survey Blocks in England. **

A second group of 132 further blocks has been subjected to detailed assessment under the Conservation of Habitats and Species Regulations 2010, the findings of which are now out for consultation.

Subject to the outcome of that consultation, the OGA will announce offers for the second group of licence blocks ‘later in the year’. The licences for all offered blocks will then be granted after the terms and conditions have been finalised.

Lord Bourne, the UK Govt. Energy Minister in the Lords said: “Investment in shale could reach £33 billion and support 64,000 jobs – creating financial security for hardworking people and their families, whilst providing a cost-efficient bridge to lower-carbon energy use.

“It is important we press on and get shale moving, albeit while maintaining strong environmental controls.

Dr Andy Samuel, Chief Executive, OGA, said: “With almost 100 applications received, the 14th onshore round has attracted significant interest and high-quality proposed work programmes from a range oil and gas companies.

“Our announcement regarding the offer of 27 blocks gives those successful companies assurance about the blocks that they will be formally offered later in the year.”

Lord Bourne added: “As part of our long-term plan to build a more resilient economy, create jobs and deliver secure energy supplies, we continue to back our onshore oil and gas industry and the safe development of shale gas in the UK.

“This is why the OGA has moved quickly to confirm the winners of licence blocks which do not need further environmental assessment.”

The Habitats consultation, which covers those blocks which do require further environmental assessment, enables the public and other interested parties to submit responses by the end of September. The OGA will then consider the results of the consultation before offering any further blocks.

A “block” is an area of land, typically 10km x 10km. The Petroleum Exploration and Development Licence (PEDL), granted under the Petroleum Act 1998, affords exclusive rights to licensees “to search and bore for and get petroleum” in all the various stages of oil and gas operations – exploration, appraisal, production and abandonment of wells.

The exploration licence itself does not confer planning consent or permission to carry out specified development activities – all activities, such as drilling, will necessarily require further consents, including planning permission and environmental permits.

Following discussion with prospective licensees, and in accordance with the new devolution settlements set out in the Scotland Bill currently before Parliament and the soon to be introduced Wales Bill, the UK Government has decided that no new onshore shale oil and gas exploration licences are to be awarded in Scotland.

** The Scottish Government announced a de facto moratorium on onshore shale exploration in Scotland in January 2015 by ordering councils to hand over any related planning applications to St. Andrew’s House pending the outcome of an independent Scottish scientific study of evidence on the environmental, economic and health issues.

 See also: Scottish Energy News 15 Dec 2015

‘Let’s get fracking!’ UK Shale Task Force green-lights gas on jobs, safety, environment and economic grounds

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