31 New Licenses Issued in the Latest NSTA Round

The North Sea Transition Authority (NSTA) announced on its website that it has extended an offer for 31 further licenses in the most recent round of the 33rd oil and gas licensing.

The NSTA stated in a statement that "a total of 82 offers to 50 companies have now been made in the round, which attracted 115 bids from 76 companies across 257 blocks and part-blocks." It also stated that the licences offered in the round are anticipated to add an estimated 545 MMBoe by 2050 and 600 million barrels of oil equivalent (MMBoe) up to 2060.

The announcement emphasised that the first tranche offered 27 licences in October 2023, and the second tranche offered 24 licences in January 2024. According to the NSTA's announcement, two mergers and 29 new licenses are among the 31 proposals in the third tranche.

According to the NSTA, of the 29 new licenses, 23 are Initial Term Phases A or B, two will be Initial Term Phase C (firm wells), and the remaining four will proceed directly to Second Term, which might allow them to begin production sooner.

The NSTA stated in the statement that Phase A is for conducting geotechnical investigations and reprocessing geophysical data, Phase B is for conducting seismic surveys and obtaining more geophysical data, and Phase C is for drilling.

The NSTA noted in the release that "the number of awards in the current round are broadly similar to the most recent predecessors."

"The 31st Round, which concentrated on frontier areas, offered 37 areas over 141 blocks or part-blocks to 30 companies, the 30th Round offered 123 licenses over 229 blocks or part-blocks to 61 companies, and the 32nd Offshore Licencing Round offered 113 licenses over 260 blocks or part-blocks to 65 companies," the statement continued.

According to the NSTA's statement, the North Sea is a valuable resource for energy security and net zero delivery.

The NSTA cautioned, "Sector collaboration is essential to ensuring those systems can coexist."

The statement went on, "We have added a new clause for overlapping oil and gas licenses and wind leases for the first time, following discussions with our partners in The Crown Estate and Crown Estate Scotland."

"This will serve as the primary commercial means of resolving spatial overlaps and facilitating the coexistence of these significant industries," the statement went on.

It said, "A few more licenses may be offered at a later date, and a small number of remaining applications are being given further consideration."

As the growth into wind, hydrogen, and carbon capture and storage intensifies, the industry association Offshore Energies UK (OEUK) commented on the NSTA's most recent license offer, saying the development enhances energy security and business confidence across all sectors.

In a statement given to Rigzone, OEUK stated, "The licenses are chiefly for gas extraction from the southern North Sea, with the potential to come on stream to power and heat the UK's businesses and homes within the next five years."

The statement went on, "They will lessen the UK's reliance on imported petrol, which the NSTA has shown to be more carbon-intensive."

It said, "This means that as the industry works to create an inviting investment environment that can enable a homegrown energy transition and spur economic growth, the licences will help to lower the nation's carbon footprint."

The third tranche's thirty-one licenses were made available "after rigorous environmental checks," according to OEUK. It further mentioned that almost 200,000 employees in the UK are supported by this business.

"Every sector in the UK benefits from new oil and gas licences," stated David Whitehouse, CEO of OEUK, in the release.

They will lessen our need for more carbon-intensive imports from outside by assisting in the safe supply of domestic gas that we can feed our system. As the UK constructs the next wave of low-carbon infrastructure, these licenses will support the preservation of employment and the provision of electricity and heat to the country's businesses and residences," he continued.

"We have a choice in this year of general elections: we can support our people, our offshore companies, and our world-class supply chain to build a domestic energy transition and accelerate economic growth, or we can import even more energy and fail to develop our new wind, hydrogen, and carbon capture industries," he said.

"What's at risk are thousands of jobs in nearly every parliamentary constituency across the United Kingdom, economic growth, and our energy security," said Whitehouse.

"We all recognise that our energy mix must change, and our sector is ramping up renewables and accelerating the drive to net zero," Whitehouse said in the statement.

However, this trip will take some time. Our North Sea basin is naturally shrinking. By the end of the decade, 180 of the more than 280 oil and gas fields that we have will no longer be producing, he continued.

"An orderly transition that supports jobs and communities across the nation and meets our energy needs requires the churn of licenses," Whitehouse declared.

In its statement, OEUK emphasised that it has previously cautioned that, absent new investment, 80 percent of the UK's demands by 2030 will be met by imports of petrol and oil. According to OEUK, approximately three-quarters of the energy consumed in the UK is derived from petrol and oil.

The North Sea Transition Authority's (NSTA) recent announcement of 31 additional oil and gas licenses in the 33rd licensing round underscores the dynamic nature of the North Sea's energy sector. With a total of 82 offers to 50 companies and an anticipated addition of 545 MMBoe by 2050, these developments highlight the ongoing commitment to bolstering the UK's energy security and advancing towards net zero goals. The new licensing terms and collaborations between oil, gas, and renewable sectors signal a strategic approach to balancing energy needs and environmental responsibilities.

As an international oilfield procurement and services provider, Blue Sky Oilfield Supply & Services (BSO) recognises the importance of staying informed about such significant industry updates. We remain dedicated to supporting the oil and gas sector with our expertise in exploration, production, and drilling services, ensuring our clients are well-equipped to navigate these evolving opportunities.