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OGA Overview 20192020
Front cover Courtesy of BP Exploration
3
OGA role 4Introduction from the Chief Executive 5Current context 6-7Transition to net zero 8The big opportunity and energy integration 9Regulatory framework 10Exercise of the OGArsquos powers 11UKCS commercial landscape 12Ownership in transition 13Fiscal measures 14UK performs favourably 15Resource base 16Projects in execute phase 17UK oil and gas production projectionscenarios 18Measuring success 19
Revitalise exploration 20-21
Improve asset stewardship 22-24
Asset stewardship ndash driving improvement Further example operator benchmarksWells
Create the right conditions 25
Significance of the supply chain
Drive regional development 26-27
Area plansMarginal discoveries
Leverage technology and data 28-31
Leverage technologyDigital transformationOGA Data Centre
Improve decommissioning efficiency 32-33
Reducing decommissioning costs OGA role in the energy transition 34Carbon capture and storage 35
Develop people processes and systems 36-40
Onshore licensing and consents The way forwardMER UK Forum Steering Group and Task ForcesMER UK in actionExperienced leadership
Who does what in UK government 41 Key publications 42-43
Contents
4
OGA role
The OGA regulates the exploration and development of the UKrsquos offshore and Englandrsquos onshore oil and gas the UKrsquos carbon storage and gas storage and offloading activities
The OGA has an important role to promote investment in the UKCS promote the opportunities that the transition to a lower carbon economy will bring create value in the UK through exports and develop the prosperity of the industry including wider supply chain
Regulate
Promote
MERUK
The OGA has a critical role to influence and encourage a culture of greater collaboration on the UKCS improve commercial behaviours help enable a more efficient industry and to support and influence the UKrsquos transition to a low carbon economy
Influence
OGA valuesAccountableFairRobust Considerate
55
Introduction from the Chief ExecutiveThe Oil and Gas Authority (OGA) works alongside the UK oil and gas industry and government to maximise the economic recovery (MER UK) of the UKrsquos oil and gas resources and to fully support the energy transition
Much has been achieved over the past few years since the OGA was established The central production projection out to 2050 is now 39 billion barrels higher than it was in 2015 A mix of field life extensions infield reserve additions enhanced oil recovery new projects and discoveries have helped add this extra 45 to the original projection
Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future and maximising economic recovery from the UKCS is still vital to meet our energy demands and reduce reliance on hydrocarbon imports The OGA estimates there are potentially over 20 billion plus barrels of oil equivalent remaining in the UK Continental Shelf and decades of economic life
Very high on my priority list right now is working with government and oil and gas companies on the vital role this industry must play in the UKrsquos energy transition ndash both in driving to net zero carbon across the UKCS as quickly as possible and also progressing the opportunities that overall UK net zero presents We are very focused on vital solutions such as Carbon Capture and Storage (CCS) including re-using existing infrastructure The OGA is also leading a cross-regulator project studying opportunities for deeper offshore energy integration with renewables gas to wire hydrogen and offshore energy hubs
Key to achieving MER UK and central to the diversification to a lower carbon future is our world class supply chain This supply chain is also home to circa 80 of the jobs in our sector And now all new oil and gas projects (including decommissioning) require a SCAP (supply chain action plan) to be in place and approved by the OGA setting out the contracting strategy to ensure maximum value is generated from each project
Over the last few years we have worked with industry to better connect our supply chain within oil and gas whilst in parallel encouraging meaningful diversification into areas such as renewable energy and CCS In addition we have supported industry on the enormous export potential for this sector and for example in June 2019 helped organise the UKrsquos first ever Energy Exports Conference
Data and digitalisation will help unlock these and other opportunities We continue to maximise the value from the wealth of UKCS data making it openly and transparently available for all through our new National Data Repository and other digital platforms which are real game-changers
Our stewardship data provide evidence that industry is collaborating to sustain improvements Compared to 2014 costs are down production is up and the UKCS is globally competitive Decommissioning activity has progressed well with an impressive 17 reduction in the total estimated cost on a like-for-like basis on the 2017 inventory Operators are clearly thinking more strategically about technology uptake and there is evidence of more collaborative partnering with the supply chain and improvements in commercial behaviours more generally
Looking ahead industry must focus on establishing its role in the energy transition sustaining cost efficiencies and progressing efficient projects Achieve this and there is an exciting future ahead
Dr Andy Samuel Chief Executive
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
Front cover Courtesy of BP Exploration
3
OGA role 4Introduction from the Chief Executive 5Current context 6-7Transition to net zero 8The big opportunity and energy integration 9Regulatory framework 10Exercise of the OGArsquos powers 11UKCS commercial landscape 12Ownership in transition 13Fiscal measures 14UK performs favourably 15Resource base 16Projects in execute phase 17UK oil and gas production projectionscenarios 18Measuring success 19
Revitalise exploration 20-21
Improve asset stewardship 22-24
Asset stewardship ndash driving improvement Further example operator benchmarksWells
Create the right conditions 25
Significance of the supply chain
Drive regional development 26-27
Area plansMarginal discoveries
Leverage technology and data 28-31
Leverage technologyDigital transformationOGA Data Centre
Improve decommissioning efficiency 32-33
Reducing decommissioning costs OGA role in the energy transition 34Carbon capture and storage 35
Develop people processes and systems 36-40
Onshore licensing and consents The way forwardMER UK Forum Steering Group and Task ForcesMER UK in actionExperienced leadership
Who does what in UK government 41 Key publications 42-43
Contents
4
OGA role
The OGA regulates the exploration and development of the UKrsquos offshore and Englandrsquos onshore oil and gas the UKrsquos carbon storage and gas storage and offloading activities
The OGA has an important role to promote investment in the UKCS promote the opportunities that the transition to a lower carbon economy will bring create value in the UK through exports and develop the prosperity of the industry including wider supply chain
Regulate
Promote
MERUK
The OGA has a critical role to influence and encourage a culture of greater collaboration on the UKCS improve commercial behaviours help enable a more efficient industry and to support and influence the UKrsquos transition to a low carbon economy
Influence
OGA valuesAccountableFairRobust Considerate
55
Introduction from the Chief ExecutiveThe Oil and Gas Authority (OGA) works alongside the UK oil and gas industry and government to maximise the economic recovery (MER UK) of the UKrsquos oil and gas resources and to fully support the energy transition
Much has been achieved over the past few years since the OGA was established The central production projection out to 2050 is now 39 billion barrels higher than it was in 2015 A mix of field life extensions infield reserve additions enhanced oil recovery new projects and discoveries have helped add this extra 45 to the original projection
Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future and maximising economic recovery from the UKCS is still vital to meet our energy demands and reduce reliance on hydrocarbon imports The OGA estimates there are potentially over 20 billion plus barrels of oil equivalent remaining in the UK Continental Shelf and decades of economic life
Very high on my priority list right now is working with government and oil and gas companies on the vital role this industry must play in the UKrsquos energy transition ndash both in driving to net zero carbon across the UKCS as quickly as possible and also progressing the opportunities that overall UK net zero presents We are very focused on vital solutions such as Carbon Capture and Storage (CCS) including re-using existing infrastructure The OGA is also leading a cross-regulator project studying opportunities for deeper offshore energy integration with renewables gas to wire hydrogen and offshore energy hubs
Key to achieving MER UK and central to the diversification to a lower carbon future is our world class supply chain This supply chain is also home to circa 80 of the jobs in our sector And now all new oil and gas projects (including decommissioning) require a SCAP (supply chain action plan) to be in place and approved by the OGA setting out the contracting strategy to ensure maximum value is generated from each project
Over the last few years we have worked with industry to better connect our supply chain within oil and gas whilst in parallel encouraging meaningful diversification into areas such as renewable energy and CCS In addition we have supported industry on the enormous export potential for this sector and for example in June 2019 helped organise the UKrsquos first ever Energy Exports Conference
Data and digitalisation will help unlock these and other opportunities We continue to maximise the value from the wealth of UKCS data making it openly and transparently available for all through our new National Data Repository and other digital platforms which are real game-changers
Our stewardship data provide evidence that industry is collaborating to sustain improvements Compared to 2014 costs are down production is up and the UKCS is globally competitive Decommissioning activity has progressed well with an impressive 17 reduction in the total estimated cost on a like-for-like basis on the 2017 inventory Operators are clearly thinking more strategically about technology uptake and there is evidence of more collaborative partnering with the supply chain and improvements in commercial behaviours more generally
Looking ahead industry must focus on establishing its role in the energy transition sustaining cost efficiencies and progressing efficient projects Achieve this and there is an exciting future ahead
Dr Andy Samuel Chief Executive
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3
OGA role 4Introduction from the Chief Executive 5Current context 6-7Transition to net zero 8The big opportunity and energy integration 9Regulatory framework 10Exercise of the OGArsquos powers 11UKCS commercial landscape 12Ownership in transition 13Fiscal measures 14UK performs favourably 15Resource base 16Projects in execute phase 17UK oil and gas production projectionscenarios 18Measuring success 19
Revitalise exploration 20-21
Improve asset stewardship 22-24
Asset stewardship ndash driving improvement Further example operator benchmarksWells
Create the right conditions 25
Significance of the supply chain
Drive regional development 26-27
Area plansMarginal discoveries
Leverage technology and data 28-31
Leverage technologyDigital transformationOGA Data Centre
Improve decommissioning efficiency 32-33
Reducing decommissioning costs OGA role in the energy transition 34Carbon capture and storage 35
Develop people processes and systems 36-40
Onshore licensing and consents The way forwardMER UK Forum Steering Group and Task ForcesMER UK in actionExperienced leadership
Who does what in UK government 41 Key publications 42-43
Contents
4
OGA role
The OGA regulates the exploration and development of the UKrsquos offshore and Englandrsquos onshore oil and gas the UKrsquos carbon storage and gas storage and offloading activities
The OGA has an important role to promote investment in the UKCS promote the opportunities that the transition to a lower carbon economy will bring create value in the UK through exports and develop the prosperity of the industry including wider supply chain
Regulate
Promote
MERUK
The OGA has a critical role to influence and encourage a culture of greater collaboration on the UKCS improve commercial behaviours help enable a more efficient industry and to support and influence the UKrsquos transition to a low carbon economy
Influence
OGA valuesAccountableFairRobust Considerate
55
Introduction from the Chief ExecutiveThe Oil and Gas Authority (OGA) works alongside the UK oil and gas industry and government to maximise the economic recovery (MER UK) of the UKrsquos oil and gas resources and to fully support the energy transition
Much has been achieved over the past few years since the OGA was established The central production projection out to 2050 is now 39 billion barrels higher than it was in 2015 A mix of field life extensions infield reserve additions enhanced oil recovery new projects and discoveries have helped add this extra 45 to the original projection
Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future and maximising economic recovery from the UKCS is still vital to meet our energy demands and reduce reliance on hydrocarbon imports The OGA estimates there are potentially over 20 billion plus barrels of oil equivalent remaining in the UK Continental Shelf and decades of economic life
Very high on my priority list right now is working with government and oil and gas companies on the vital role this industry must play in the UKrsquos energy transition ndash both in driving to net zero carbon across the UKCS as quickly as possible and also progressing the opportunities that overall UK net zero presents We are very focused on vital solutions such as Carbon Capture and Storage (CCS) including re-using existing infrastructure The OGA is also leading a cross-regulator project studying opportunities for deeper offshore energy integration with renewables gas to wire hydrogen and offshore energy hubs
Key to achieving MER UK and central to the diversification to a lower carbon future is our world class supply chain This supply chain is also home to circa 80 of the jobs in our sector And now all new oil and gas projects (including decommissioning) require a SCAP (supply chain action plan) to be in place and approved by the OGA setting out the contracting strategy to ensure maximum value is generated from each project
Over the last few years we have worked with industry to better connect our supply chain within oil and gas whilst in parallel encouraging meaningful diversification into areas such as renewable energy and CCS In addition we have supported industry on the enormous export potential for this sector and for example in June 2019 helped organise the UKrsquos first ever Energy Exports Conference
Data and digitalisation will help unlock these and other opportunities We continue to maximise the value from the wealth of UKCS data making it openly and transparently available for all through our new National Data Repository and other digital platforms which are real game-changers
Our stewardship data provide evidence that industry is collaborating to sustain improvements Compared to 2014 costs are down production is up and the UKCS is globally competitive Decommissioning activity has progressed well with an impressive 17 reduction in the total estimated cost on a like-for-like basis on the 2017 inventory Operators are clearly thinking more strategically about technology uptake and there is evidence of more collaborative partnering with the supply chain and improvements in commercial behaviours more generally
Looking ahead industry must focus on establishing its role in the energy transition sustaining cost efficiencies and progressing efficient projects Achieve this and there is an exciting future ahead
Dr Andy Samuel Chief Executive
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
4
OGA role
The OGA regulates the exploration and development of the UKrsquos offshore and Englandrsquos onshore oil and gas the UKrsquos carbon storage and gas storage and offloading activities
The OGA has an important role to promote investment in the UKCS promote the opportunities that the transition to a lower carbon economy will bring create value in the UK through exports and develop the prosperity of the industry including wider supply chain
Regulate
Promote
MERUK
The OGA has a critical role to influence and encourage a culture of greater collaboration on the UKCS improve commercial behaviours help enable a more efficient industry and to support and influence the UKrsquos transition to a low carbon economy
Influence
OGA valuesAccountableFairRobust Considerate
55
Introduction from the Chief ExecutiveThe Oil and Gas Authority (OGA) works alongside the UK oil and gas industry and government to maximise the economic recovery (MER UK) of the UKrsquos oil and gas resources and to fully support the energy transition
Much has been achieved over the past few years since the OGA was established The central production projection out to 2050 is now 39 billion barrels higher than it was in 2015 A mix of field life extensions infield reserve additions enhanced oil recovery new projects and discoveries have helped add this extra 45 to the original projection
Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future and maximising economic recovery from the UKCS is still vital to meet our energy demands and reduce reliance on hydrocarbon imports The OGA estimates there are potentially over 20 billion plus barrels of oil equivalent remaining in the UK Continental Shelf and decades of economic life
Very high on my priority list right now is working with government and oil and gas companies on the vital role this industry must play in the UKrsquos energy transition ndash both in driving to net zero carbon across the UKCS as quickly as possible and also progressing the opportunities that overall UK net zero presents We are very focused on vital solutions such as Carbon Capture and Storage (CCS) including re-using existing infrastructure The OGA is also leading a cross-regulator project studying opportunities for deeper offshore energy integration with renewables gas to wire hydrogen and offshore energy hubs
Key to achieving MER UK and central to the diversification to a lower carbon future is our world class supply chain This supply chain is also home to circa 80 of the jobs in our sector And now all new oil and gas projects (including decommissioning) require a SCAP (supply chain action plan) to be in place and approved by the OGA setting out the contracting strategy to ensure maximum value is generated from each project
Over the last few years we have worked with industry to better connect our supply chain within oil and gas whilst in parallel encouraging meaningful diversification into areas such as renewable energy and CCS In addition we have supported industry on the enormous export potential for this sector and for example in June 2019 helped organise the UKrsquos first ever Energy Exports Conference
Data and digitalisation will help unlock these and other opportunities We continue to maximise the value from the wealth of UKCS data making it openly and transparently available for all through our new National Data Repository and other digital platforms which are real game-changers
Our stewardship data provide evidence that industry is collaborating to sustain improvements Compared to 2014 costs are down production is up and the UKCS is globally competitive Decommissioning activity has progressed well with an impressive 17 reduction in the total estimated cost on a like-for-like basis on the 2017 inventory Operators are clearly thinking more strategically about technology uptake and there is evidence of more collaborative partnering with the supply chain and improvements in commercial behaviours more generally
Looking ahead industry must focus on establishing its role in the energy transition sustaining cost efficiencies and progressing efficient projects Achieve this and there is an exciting future ahead
Dr Andy Samuel Chief Executive
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
55
Introduction from the Chief ExecutiveThe Oil and Gas Authority (OGA) works alongside the UK oil and gas industry and government to maximise the economic recovery (MER UK) of the UKrsquos oil and gas resources and to fully support the energy transition
Much has been achieved over the past few years since the OGA was established The central production projection out to 2050 is now 39 billion barrels higher than it was in 2015 A mix of field life extensions infield reserve additions enhanced oil recovery new projects and discoveries have helped add this extra 45 to the original projection
Government forecasts show that oil and gas will remain an important part of our energy mix for the foreseeable future and maximising economic recovery from the UKCS is still vital to meet our energy demands and reduce reliance on hydrocarbon imports The OGA estimates there are potentially over 20 billion plus barrels of oil equivalent remaining in the UK Continental Shelf and decades of economic life
Very high on my priority list right now is working with government and oil and gas companies on the vital role this industry must play in the UKrsquos energy transition ndash both in driving to net zero carbon across the UKCS as quickly as possible and also progressing the opportunities that overall UK net zero presents We are very focused on vital solutions such as Carbon Capture and Storage (CCS) including re-using existing infrastructure The OGA is also leading a cross-regulator project studying opportunities for deeper offshore energy integration with renewables gas to wire hydrogen and offshore energy hubs
Key to achieving MER UK and central to the diversification to a lower carbon future is our world class supply chain This supply chain is also home to circa 80 of the jobs in our sector And now all new oil and gas projects (including decommissioning) require a SCAP (supply chain action plan) to be in place and approved by the OGA setting out the contracting strategy to ensure maximum value is generated from each project
Over the last few years we have worked with industry to better connect our supply chain within oil and gas whilst in parallel encouraging meaningful diversification into areas such as renewable energy and CCS In addition we have supported industry on the enormous export potential for this sector and for example in June 2019 helped organise the UKrsquos first ever Energy Exports Conference
Data and digitalisation will help unlock these and other opportunities We continue to maximise the value from the wealth of UKCS data making it openly and transparently available for all through our new National Data Repository and other digital platforms which are real game-changers
Our stewardship data provide evidence that industry is collaborating to sustain improvements Compared to 2014 costs are down production is up and the UKCS is globally competitive Decommissioning activity has progressed well with an impressive 17 reduction in the total estimated cost on a like-for-like basis on the 2017 inventory Operators are clearly thinking more strategically about technology uptake and there is evidence of more collaborative partnering with the supply chain and improvements in commercial behaviours more generally
Looking ahead industry must focus on establishing its role in the energy transition sustaining cost efficiencies and progressing efficient projects Achieve this and there is an exciting future ahead
Dr Andy Samuel Chief Executive
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
6
Current context Infrastructure
Exploration success rates Resources
10bn
Development Projects consented
54bn boein production or under development
NNS
WOS
CNS
SNSIS
wells drilled to date7800+
pipelines20000 kms+
fixed installations320+
subsea systems250+
Remaining potential 10bn - 20bn+
20bn+
2017 2018
Number of projects 7 20
CAPEX (pound billion) 07 39
Reserves (mmboe) 100 490
NPV10 (pound billion) 11 50
245839
1
Technical volume mmboe
Technical finding cost $boe
2014 2018
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
7
2008
20092010
2011
2012
2013
2014
2015
20162017
2018
Cost E
fficie
ncy a
nd O
pera
tiona
l
Effic
iency
Incr
easin
g
Cost Effic
iency and
Operational E
fficiency D
ecreasing
Improvem
ents in PE
but costs still rising
Annual average UOC and PEU
OC
(poundb
oe 2
018
pric
es)
21
19
17
15
13
11
9
7
5
PE
55 60 65 70 75 80
Production barrels of oil equivalent per day (boepd)
142 157 163 163
million million million million
2014 2015 2016 2017
Production efficiency (PE) and unit operating costs
Supply chain
pound27bnturnover
c40 through exports and supporting
c80 of UK oil and gas jobs
Source ndash Oil amp Gas UK and EY
40 80
2018
17million
280gt 280000 jobs in the UK delivered through or supported by upstream oil and gas activity
Jobs
Source ndash Oil amp Gas UK
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
8
Transition to net zeroMaximising economic recovery from the UKCS is vital to meet our energy demands reduce reliance on imports and support a supply chain which can diversify into other energy markets
UK oil demand and production
UK gas demand and production
1970 2035
0
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Oil Production
Oil Production (OGA March 2019Projection)
Actual Oil Demand (excluding marinebunkers)
Oil Demand (BEIS UEP 2018 ReferenceScenario)
1970 20350
10
20
30
40
50
60
70
80
90
100
110
120
130
140
150
160
mill
ion
tonn
es o
f oil
equi
vale
nt
Actual Gross Gas Production
Gross Gas Production (OGA March 2019Projection) Actual Gross Gas Demand
Gross Gas Demand (BEIS UEP 2018Reference Scenario)
Energy security
Diversification transition to net zero 2050
Strong supply chain
exporting globally
Anchor skills in UK
MER UK
2050
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
9
The big opportunity and energy integrationOil and gas continues to play key role in UK energy system
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
10
Regulatory frameworkLegislative Context
Supporting Obligations
Execution
Cost reduction
Guidance
SanctionNotices
Statutory non-statutory and Stewardship Expectations
Enforcementnotice
Financial penalty notice
Operator removal notice
Licence revocation notice
Central Obligation MER UK Strategy lsquoto take the steps necessary to secure that the maximum value of economically recoverable petroleum is recoveredrsquo Includes safeguards to protect and promote investment
Infrastructure Act 2015 Petroleum Act 1998Energy Acts 2011 and 2016
RegulatoryPowers
Facilitation Licensing regime Strategies and delivery programmes
MER UK plans
Regulatory powers
Non-binding dispute resolution
Information and samples Meetings Licence
model clausesThird party
access
Collaboration
Exploration Regional development
Asset stewardship Technology Decommissioning
Sanctions
Principal Objective The principal objective is that of lsquomaximising the economic recovery of UK petroleumrsquo
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
11
Exercise of the OGArsquos powersThe OGA uses lsquomeasured escalationrsquo to manage lsquoissuesrsquo where the OGA seeks primarily to influence the outcome and lsquocasesrsquo where the OGA will consider intervention with regulatory powers
Separately the OGA enforces licence obligations and deadlines to drive the pace of delivery and ensure that the right assets are in the right hands
Esca
latin
g le
vel o
f OG
A in
terv
entio
n
Operations Escalation Regulatory Escalation
Investigation5
Under these categories
Striking the right balance
RewardsSanctions Enforcement noticeFinancial penalty notice up to pound1mLicence revocation Operator removal
Greater value via collaborationTransparency and better data accessTimely effective decision making
MER UK benefits all
Asset Stewardship
Strategic use of data
Use
of P
ower
sOGA interventions
Area Plans
17 9 6 20 20
Further details on the measured escalation process can be found in the OGArsquos Enquiry Guidance
OGArsquos measured escalation process
45 Issues
33 Cases
Stage at which an issue or case issue closed
Enquiry
28Facilitation18 Enhanced
Facilitation
27
Access to infrastructure
Licence Commitments
Asset Transfers
Intra Inter JV
Area Solutions
Compliance
Closed interventions 2017 to present (Last update July 2019)
6
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
12
Changing commercial environment to deliver right assets right hands
UKCS commercial landscape
Contractor finance
Late life specialists
Innovative development
OGA
Assess financial capability
Understand technical capability
Review applicant capability to operate or credentials to be a non-op partner
Innovative deal structures helping new entrants
Majors consolidating and re-focusing eg West of Shetland
Innovative decommissioning agreements (eg seller retains liability) helping stimulate MampA
Late-life specialists bringing diversity
Chrysaor and Baker Hughes commercial partnership
Baker Hughes to fund a portion of CAPEX for a potential higher return
Risk and reward sharing drilling programme
Operator and service provider working together to realise value
BPEnQuest SVT and Magnus transactions
No cash upfront from EnQuest transaction funded by deferred consideration
Operator focused on bringing down costs and extend life
BP has stated this transaction highlights right assets right hands
Tolmount development
Antin Infrastructure Partners to part own platform and pipeline and pay for terminal upgrade
Development expected to produce 500bcf of gas with peak production of 300 mmscfd
First gas target Q4 2020 as per licence commitment
Case studies commercial modelsMampA and the regulatory process
Right assets right hands
BEIS
Manages Section 29 liability
Consultee in regulatory process for MampA activity
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
13
Ownership in transition
25000
Small Cap
Mid Cap
Large Cap Supermajor
Private Equity
Other
Utilities
35
Current production changed hands in past 5 years
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Average Daily Production
Operator shares of infrastructure based
on throughput
2014
2018
2018Production
2014Production
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Key
25 thousandboed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
boed
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Small cap
Mid cap
Large capSupermajor
Private equityInfrastructure funds
Other
Utilities
Each pie chart represents a geographical area
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
14
Supplementary Charge reduced
from 32 to 10
Petroleum Revenue Tax permanently
reduced from 50 to 0
Basin-wide Investment Allowance
2 x pound20 million for new geophysical surveys in 2015 amp 2016 and pound5m for explorationdata in 2017
Transferable tax history gives buyers increased certainty
they can get tax relief for their
decommissioning costs
In line with the Driving Investment principles various measures introduced since 2015 include
Fiscal measuresThe three Driving Investment principles for tax policy-making
The overall tax burden will need to fall as the basin matures
In setting fiscal policy the government will consider the wider economicbenefits of oil amp gas production in addition to revenues
A lsquofair returnrsquo will take account of the global competitiveness of commercial opportunities in the UK and UKCS commodity prices and costs
1
2
3
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
15
Leading on returns payback break-evens and value
UK performs favourablyIRR and reserves Payback periods Break-evens and value per bbl
Source OGAWood Mackenzie
Number of projects in each region Payback period years
UK post tax IRR is 13 higher than next highest basin
MER UK Forum and Task Forces the OGA and industry jointly committed to maintaining current cost disciplines
UKCS still has diverse portfolio of opportunities from large complex developments to small low cost tie-backs
Opportunities and dramatically lower unit costs mean UKCS boasts world-class payback periods
Recent investments in UK projects have delivered world-class returns in terms of breakeven and value per barrel
OGArsquos marginal discoveries initiative illustrates the continuing potential of the UK
Value per barrel (post tax) Breakevens
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
16
Resource base(N
umbe
rs in
billi
on b
oe a
s at
end
201
8)
2018
changes
02
06
Billion boe moved into sanctioned from project approvals in 2018
Billion boe produced in 2018 with 75 production efficiency
Billion boe added from new discoveries in 2018
41 prospective resources in
mapped prospects and leads
75unsanctioned
(52 from proposed new developments and other discoveries)
55 sanctioned
447 produced to date
Prospects leads and plays
Rang
e of
tota
l pot
entia
l res
ourc
es
ca 1
0 to
20b
n bo
e
05
2018 Resource and reserve maturation
112 in plays
Significant remaining resource potential
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
17
Projects in execute phaseConsented 2019
The OGA does not provide endorsements or investment recommendations Those projects listed are not necessarily a definitive list and the locations are indicative
Consented 2018Consented 2011-2017
NNS
WOS
CNS
SNSIS
Alligin
Galleon FDPA
Tolmount
Fram
Buzzard Phase 2 FDPA
CookFDPA
Seagull
Arran
Finlaggan
Columbus
Vorlich
Joanne
Captain EOR FDPA
Shearwater Re-Plumb FDPA
Penguins FDPA
West Brae FDPA
Utgard
BucklandFDPAStorr Phase 1
Consented projects - not yet in production as at mid 2019
Solan FDPA
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
18
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
February 2019 Projection
March 2015 Projection
An additional 39bn boe added to projections since March 2015
Contributing factors to the 39bn boe added since March 2015
Estim
ated
add
ition
al c
ontr
ibut
ion
(bn
boe)
0
02
04
06
08
10
2015-18Extra
ProductionPostponing
COP
InfieldReserves
Aid EORProject
SanctionsOther
factors
RecentEampA
ActivityFuture
Exploration
094
090
028
061
025030030032
UK oil and gas production projectionscenarios
+39bnboe
Additional
00
05
10
15
20
2015
2020
2025
2030
2035
2040
2045
2050
yadtnelaviuqe lio fo slerrab noillim
Vision Scenario
February 2019 Projection
March 2015 Projection
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
19
Measuring success
Costs mitigatedpoundM 850
Value of investmentspoundbn 37
Time saved to industry (fast-tracked consents) 3919
DAYS
Success metrics
377 success stories were recorded between 2015 and 30th June 2019 across the OGA in partnership with industry and government
The OGA has developed a success stories tracker dashboard and methodology to allow impact to be quantified (relative to what would have happened in the absence of support or intervention) using three key metrics
Expected future volume of oil and gas production
Capital expenditure committed to new projects
Reduced or avoided costs through improved or accelerated outputs
Tripartite barrels(mmboe)
Protect existing barrels mmboe
866
Newbarrels added mmboe
11161982
Decommissioning cost savings(poundM)
Actual poundM 323
Forecast poundM 194517
Impact on industry Action by the OGA
Production volume
Technologies
Exploration opportunities
Supply chain initiatives
Decommissioning opportunities
Decommissioning cost reduction
Influence
Promote
RegulateResource maturation
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
20
Key
Revitalise explorationThe OGA has provided substantial incentives and data packages to support licensing rounds and help stimulate interest including
Legend
Exploration wells drilled since OGA establishedRestricted Blocks30th Round Awards31st Round Awards31st Supplementary Round Blocks Offered32nd Round Blocks OfferedRhum Out Of Round Blocks OfferedLicenses awarded in previous rounds
For indicative purposes only
Proposed future licensing plan
2019 2020 2021
31st
supplementary Q1
32nd
33rd
All rounds alternating between frontier and mature areas
Mature Areas
Frontier Areas
Round opens
Round closes
Licence awards
Frontier Areas Mature Areas
Rev
italis
e ex
plor
atio
n
Note Licence Rounds and timings are contingent on the Strategic Environmental Assessment (SEA) with the next SEA assessment planned in 202021
Mature - Greater Buchan Area
pound40 million UK govt funding for new seismic acquisition in frontier areas and reprocessing legacy data
Digital geological maps to promote enhanced regional understanding prospect and discovery reports
Public Release of the Southern North Sea Seismic MegaSurvey
In support of the 32nd licensing round the UK government has also provided pound5million funding for rock physics analysis and petroleum systems database
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
21
Rev
italis
e ex
plor
atio
n
11
14 11
090904
23
20
17 13
11
04 05
03Reserves
Prospective Resources ndash Plays
SNS (inc SW Britain for plays)
CNS (incMid North Sea Highfor plays)
NNS
35
Contingent Resources (Mean volumes) ndashIn field and in development
Prospective Resources ndashLeads and Prospects
Contingent Resources (Mean volumes) ndashUndeveloped Discoveries
4716
14
08 WoS
17
25
Rockall Trough
Revitalising exploration activity
Alternating frontier and mature rounds
Innovative licence framework low entry barriers
Large volumes of free geoscience data
National Data Repository (NDR) of well and seismic information
Targeting yet-to-find potential new prospects and plays
Improving performance technical stewardship and technology
Integrating exploration into Area Plans
Focusing on value not volume
Exploration success rates
No Exploration
Wells
Technical Success Rate
Technical finding cost
$boe
Technical Volume mmboe
2014 13 69 9 83
2015 15 53 5 115
2016 11 45 5 64
2017 15 47 35 131
2018 7 43 1 239
FF
F
M
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2222
Impr
ove
asse
t ste
war
dshi
p Asset stewardship ndash driving improvement
Rationalised industry surveys A single source of robust data covering the whole asset life cycle across the UKCS
Asset stewardship expectations are an OGA view of lsquogood practicesrsquo and provide information as to whether a licenseeoperator is meeting the MER UK strategy obligations
LEADS
PLAY
PROSPECT
POTENTIALIN
FIELD
SANC
TIO
NED
DEVE
LOPM
ENTS
DEVELOPMENT
UNDER
PRODUCING
OPTIMISATION
DEVELOPMENTS
DISCOVERIES
(Mean unrisked)
CONTINGENT
RESOURCES
PROSPECTIVE
RESO
URCES
(2C)
RESERVES (2P)
PRODUCTION
All UKCS Operators
Rationalised Survey Returns via Energy Portal
Full UKCS asset life-cycle
OGA Data review and analysis
Forecasting Operator Benchmarking Industry performance Decom cost
reductionResource
Progression
Senior Leadership
Tier ZeroTier One
Tier Two
MER UK ForumMER UK Steering GroupSector DealMD MeetingsTier Zero
Progress of OpportunitiesKey Industry ThemesBenchmarkingCollaboration
Resource ProgressionMaximise ReservesEmbedding StewardshipOperator Scorecard
OperatorsExplorationNew DevelopmentsTechnologyDecommissioningCollaboration (CBQT)
Stewardship expectations Refreshed in 2019 to reflect three years of experience
10 Expectations which apply across the whole exploration and production lifecycle
Maintains the strong linkage between expectations tiered review process annual stewardship survey and performance benchmarking
Tiered stewardship reviewsOGA amp Operator strategic engagement framework through tiered approach
Asset stewardship is crucial to maximising economic recovery from the UKCS and to delivery greater value overall The asset stewardship expectations are embedded through regular interface with industry
Net
uni
t ope
ratin
g co
st (pound
boe
)
Operators
Benchmark operator X example
35
30
25
20
15
10
5
0
BenchmarkingOGA now benchmarks 18 different metrics with 69 sub elements - driving industry-wide performance improvements
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
23
Impr
ove
asse
t ste
war
dshi
p
23
Further example operator benchmarksProduction Efficiency (PE) Unit Operating Cost (UOC) Reserves Replacement Wells Data Cleansing
Exploration Performance Seismic Compliance Field Recovery Factor Collaboration
Colours represent year on year change
Field quality index
Rec
over
y fa
ctor
Operator X
Operator X
2017
Res
erve
s R
epla
cem
ent
Operator X
Operator X
KPI derived from basket of 7 exploration metrics
Operator X
Expl
orat
ion
KPI s
core
Operator Xpoundboe
0 5 10 15 20 25 30
Operator X
Acquisition
Processing0102030405060708090100
0102030405060708090100
Operator X
Operator X
Operator X
Operator X
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2424 24
WellsIm
prov
e as
set s
tew
ards
hip
Transformational increase in well activity and management required to deliver 7bn boe additional reserves
The issue 2016 2017 2018
No spuds 109 94 101
Non productive time 17 15 23
Surveillance NA 8 2
Intervention rate NA 14 8
Provisional numbers
Strategy Stewardship Lessons learned Industry
Regulatory compliance
Increase activity levels
Improve activity performance
Well activity performance
Lessons learned used amp shared
Productivity of wells
Identify common opportunities
Share basin knowledge
Inform industry workstreams
Competitive well delivery taskgroup
Reservoir amp well optimisation taskgroup
OGA response
Wells Strategy
Stewardship Expectations
Insights Report
Lessons learned
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2525
Significance of the supply chain
Working with DIT SDI UKEF and EIC
To drive growth of the UK oil and gas Supply Chain by an additional pound290bn ndash exports from 37 to 74 of global market
Over 80 Supply Chain Action Plans (SCAPs) received Now an integral and mandatory part of the Field Development Plan and Decommissioning Programme approval process requires operators to demonstrate they are
SCAPs
Delivering maximum value from project activity in line with MER UK
Driving Decommissioning costs down through innovative and collaborative contracting
Contributing to Total Value Add (TVA) through supply chain engagement
OGA supporting
Collaboration
Tangible reduction in project costs through collaborative contracting
Effective engagement between the UK Norway Netherlands and Denmark (One North Sea)
Meet the BuyerHackathons
Solution driven events creating an environment for open discussion between the operator and the supply chain
Oil and Gas Pathfinder Allowing operators to highlight challenges and seek solutions from the service sector Providing visibility of supply chain opportunitiesGives overall view of UKCS activity to the industry
UK supply chainexports turnover
Service sector - anchored in the UK enabling MER UK and exporting to the world
2015pound35bn
2016pound30bn
2017pound27bn
85
60
80
Develops over 60 of new technologies
80 of UKCS workforce
Approx 85 of operator spend
Cre
ate
the
right
con
ditio
ns
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2626
Area plansD
rive
regi
onal
dev
elop
men
t
West of Shetland Gas
East of Shetland Decom
Quad 9 Gas
Outer Moray Firth
Central Graben Area
SNS Infrastructure Optimisation
East Irish Sea
Tight Gas
Gannet (Fulmar Bypass)
Fram Arran Columbus Vorlich
Penguins
Four plans have already moved to stewardshipPenguins Unlocking new opportunities in a mature field
Fram Arran Columbus amp Vorlich Delivering an additional 100mmboe
Gannet Protects production beyond previous export route cessation of production
Tight Gas in Southern North Sea A number of tight gas infill wells spudded
Area plans integrate exploration through to decom
Optimise infrastructure extend life for MER UK
OGA establish plan amp timing ndash use it or lose it
New operators new partnerships - right assets right hands
Industry best placed to deliver detail per behavioural guidelines
Unlocking discoveries undeveloped for decades
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2727
Potential solutions to unlock this prize
Marginal discoveriesA significant contribution to achieving MER UK is the exploitation of over 300 undeveloped marginal discoveries which offer opportunities for clustering and aggregated discovery volumes Most are within but some are outside tie-back distance and therefore may be better suited to stand-alone type solutions
Breakdowns of discovery volumes ndash 33 bn boe of potential
WOS
NNS
MFB
CNS
SNS
EIS
WOS West of Shetland
NNS Northern North Sea
MFB Moray Firth Basin
CNS Central North Sea
SNS Southern North Sea
EIS East Irish Sea
33 bn boe of potential 0
1
2
3
Tech
nica
lly R
ecov
erab
le (b
nboe
)
Licensed
Unlicensed
30thRound
01
1
10
100
Licensed Unlicensed
0 100 200 300Discoveries
Tech
nica
lly
reco
vera
ble
(mm
boe)
Technology
Available and potential future innovations can unlock marginal developments such as
bull State-of-the-art inversionbull Effective and cheaper
stimulation techniquesbull High-angle ERDbull Subsea H2S treatment
at wellheadbull Tie-backs of the futurebull Efficient topsides modifications
bull Effective metering to enable daisy chain fields
bull Heavy oil production technologybull uHPHT subsea equipmentbull Low cost H2S and CO2
treatment to export gas spec
Clustering
Cluster development could lead to significantly improved CAPEX efficiencies
Area Plans
CNS has the largest UKCS share of marginal discoveries which are being developed within nine Area Plans with active involvement from industry
Production club
Other clustering concepts which are being appraised combine small undeveloped discoveries from multiple license holders to new unlocking strategies
Source OGA data
Driv
e re
gion
al d
evel
opm
ent
Phot
o co
urte
sy
Mag
seis
Fairfi
eld
and
Ampl
us
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2828 28
We work with the industry to make sure existing technologies are deployed to their full effect and relevant new technologies are developed and used to maximise economic recovery from the UKCS
MER UK Forum ndash technology priorities and ownership
Leverage technology
OGA role
DemandExplorationTask Force
Asset Stewardship Task Force
Efficiency Task Force
Decommissioning Task Force
Supply Chain Task Force
Priorities
Technology Leadership Board
bull TLB Define industryrsquos technology priorities and engage with delivery organisations
bull Technology Sponsors Champion technology development and deployment
bull Industry Technology Network UKCS Technology Network share learnings on technology adoption and deployment
Delivery
bull Takes forward themes into execution
bull Government-backed and industry-led
bull Solution Centres Centres of Excellence Innovation Hub and Technology acceleration
bull Anticipates technology need
bull Provides innovation in response to industry demand
bull World leading capabilities
bull Provides expertise knowledge and routes to funding
bull Access to advanced facilities
bull Research into early stage technology
Leve
rage
tech
nolo
gy a
nd d
ata
From operatorsrsquo Technology Plans
Published annually
Covers asset lifecycle
Oversees industry engagement
Support industry to adopt technologies for MER UK
Holds operators to account in their technology plans and stewardship expectations
Existing technologies bull Available for immediate
deployment
bull Share operatorsrsquo experience
Emerging technologies bull Address MER UK
gaps Collaborate in development and pilot
Highlights
UKCS Technology Insights
April 2019
Supply Chain
Research Academia
The Oil amp Gas Technology Centre
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
2929
Maintain asset integrity
Innovative standalone facilities
Low capexLow opex
Re-deployable (multi-use)
Versatile production units
Unmanned buoys
Low cost reusable platforms
Tie back of the future
System simplification
Plug-n-play
Re-usable
Composite spoolable
Subsea chemical injection
Subsea power
Mechanical connectors
Existing assets New developmentsOGA expectations
OGA Insights Portal
Operators deploy appropriate technologies to deliver MER UK
Operators submit annual technology plans
Embed technology in the business cycle
Deploy technology in a scaled and timely manner
Share industry learning to promote deployment
Focus on best in class ready- to-deploy technologies
Highlight emerging innovation and collaboration opportunities
Technology Insights Portal - httpswwwogauthoritycouktechnologytechnology-insights-and-portaltechnology-insights-portal
Leve
rage
tech
nolo
gy a
nd d
ata
Efficient facilities management
Cost effective decommissioning
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
303030
Digital transformationThe OGA aims to be an innovator and a catalyst helping industry academia and the supply chain to use digitalisation to unlock the huge value from data whilst at the same time providing excellent digital services to its stakeholders in support of regulatory excellence
Leve
rage
tech
nolo
gy a
nd d
ata
Digital excellence
Over 12000 wellbores
2998 pipelines
3189 subsea installations
690 surface installations
~135 million log curves
~265000 well log images
~166000 well report images
Seismic
2D
Other
3D
3D642
104
4252
4998surveys
Other
2D
InfrastructureEarly in 2019 the OGA successfully launched the United Kingdomrsquos first offshore oil and gas National Data Repository (NDR) for petroleum-related information and samples The NDR is a key piece of the UKrsquos digital infrastructure
The NDR is a huge data collection from UKCS offshore oil and gas wells 2D and 3D seismic surveys infrastructure licences and fields Operated by the OGA on the behalf of the nation industry and other interested parties
Over 300 km of drill core
45 million samples of cuttings
8000 offshore wells
Links to the National Geological Repository
Wells
includes all subsea and surface installations
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3131
OGA Data CentreThe OGArsquos most visited website area provides maximum value from the wealth of UK data licence wells and field data can be queried and downloaded Supports the OGA strategy of making as much data publicly available as soon as possible
Comprehensive data only a few clicks away
994MSpatial server requests
700growth in server requests
since OGA established
60k+users
Map it Download itView it Share itChart it
Online Production Efficiency Dashboard
Offshore licences by administrator
Leve
rage
tech
nolo
gy a
nd d
ata
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
32
Reducing decommissioning costsOn track to meet targets for cost reduction and certainty
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
pound39bn
2017 lsquoLike for Likersquo
2017 lsquoLike for Likersquo
10
7
2017 2018 2019
Baseline cost estimate 2016
prices 2019 Full Portfolio
Industry Target35 reduction
(P50) Like for Like 2017 inventory
pound56bn(P50) Like for Like
2017 inventory
pound49bn(P50) Like for Like
2017 inventory
(P50) Updated 2019 inventory
2017 prices
pound58bn
(P50) Updated 2019 inventory
2018 prices
pound51bn
2022
pound597bn(P50)
Class estimate improvement
2017 2018 2019
Significant cost forecast reductionbull Improvement in cost
estimation certaintybull Embedding experience
sharing learning adopting innovation and challenging the norm
Target 90 Class 3 or better by 2021
6535
Class 3 or better
Class 45
Class estimate Vs Time
2016
-17
2017
-18
2018
-19
2019
-20
2020
-21
2021
-22
2022
-23
2023
-24
2024
-15
2025
-26
Frac
tion
of B
asel
ine
(201
7) E
stim
ate
Like
for L
ike
Scop
e C
ompa
rison
160
140
120
100
80
60
40
20
0
pound597bn pound56bnpound49bn
32
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3333
Impr
ove
deco
mm
issi
onin
g effi
cien
cy
Priority and focus areas Sharing lessons learned
Decommissioning dashboard and benchmarking Integrated approach
OGA Priority
gt Develop collaborative execution models
gt Develop an enhanced decommissioning supply chain
Real life case studies
Project management
Warm Phase2 | Cold
Phase3 | Removal4 | Dismantle amp Dispose5 | Surveillance6 |
1 | Operating Late-life Phase
Operating1 |
Facilities running Owner costs
Well Abandonment
Facilities Pipelinemaking safe
Subsea Infrastructure
Topsidesremoval
Substructure removal
Topside amp Substructure Onshore Recycling
SiteRemediation MonitoringTopsides
preparation
PlanningScope
Execution
ScopeProjectManagement
Determine the strategic fit vs life-cycle of asset(s) in a companys portfolioAre others more natural ownersOperators at the late-life stage Divest sufficiently early for the asset(s) to still be attractive
At late-life align organisation amp contracting strategy to maximisevalue through optimising both life-cycle costs and production
Ensure organisational structure is incentivisedqualified toact on high value decom opportunities during late-life
Stewardship Discussions with the OGA utilising the Decom Dashboard will allow cost reduction opportunities to be identified and a structured capture plan agreed
Submitting a topsides Decommissioning Programme separately to that for the substructure may give valuable timing flexibility for topsides removal esp
If issues associated with the substructure decommissioning (eg with OSPAR derogation cases) may result in delays to the Decom
Consider submittinga Decommissioning Programme aheadof Cessation ofProduction (CoP) toenable opportunistic decommissioning activities ifwhen cost-effective
eg down-cycle costs maybe lower than at other times
early regulator engagement will clarify requirements of cost-effective yet compliant decommissioning
Explore sharing costs of environmental surveys datasets with nearby Operators incl utilising existing relevant reports
Planning Scope
Online portal
Success stories
20+
PampA Subsea Removals Post CoP Running Costs
Late life operation
gt 6 yrs to 3 yrs before CoP gt 3 yrs before CoP
Strategy (Corporate and UKCS)
Benchmarking and cost forecast dashboard
Learning knowledge review and implementation
Technology assessment
Strategy (Corporate and UKCS)
Plan for decommissioning
Potential for campaigns and scope aggregation
Evaluate asset condition
Potential for re-usere-purposing
ContractingExecution strategies (SCAP development)
Implement decommissioning preparations and activities
Stewardship expectations
L O N G G L I D E P A T H
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
34
OGA role in the energy transition
Working with industry government and other regulators
Department forBusiness Energyamp Industrial Strategy
UKCS Energy Integration Project The current role includes
Licensing of carbon storage and advice on suitability prior to decommissioning
A major role in maximising domestic gas production ndash an important transition fuel
Supporting diverse range of supply chain options
Continuing work on Enhanced Oil Recovery (EOR)
Understanding of offshore energy integration including electrification amp hubs
Consistency of the OGArsquos offshore flaring and venting regime with government policy
Other core OGA MER UK work with emissions benefits such as increasing operating efficiency and asset stewardship to extend life of assets
Project to explore the potential for a more integrated offshore energy sector
Building closer links between oil and gas production and offshore renewables ndash quick wins
Funded by pound900000 grant from the Better Regulation Executiversquos Regulatorsrsquo Pioneer Fund
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
35
Carbon capture and storage OGA role
Licensing and permitting authority for carbon storage ndash OGA issued first licence Dec 18
Maintain the carbon storage licence public register
Consider re-use as part of the OGA Cessation of Production process
Consultee to OPRED on operatorsrsquo decommissioning plans
Exploring the role of CO2 EOR
Working with government and industry
Taking forward key action points overview of infrastructure assets and clearer re-use policy
Engaging with CCUS project developers
Guiding project developers and applicants through OGA process
CO2 storage
CO2 transport
CO2
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3636
LegendUK Shale Prospective Areas
Onshore Licences
For indicative purposes only
Onshore licensing and consents
The OGArsquos role for onshore oil and gas includes
Regulation Ensuring an effective licensing system and regulatory controls are in place including mitigating the risk of induced seismicity
Monitoring activity Overseeing operators to ensure commitments are being pursued on over 175 licenses
Collaboration Recognising that high levels of public interest demand transparency active engagement and close working with government and other regulators
Features of OGArsquos onshore activity
Jurassic oil hybrid play Horse Hill 1 testing underway and further drilling planned to appraise the potential of the Kimmeridge Resource Play
Carboniferous shale gas Two wells drilled and hydraulic fracture operations commenced in 2018 Hydraulic fracturing operations continuing in 2019
Ongoing exploration At least three exploration wells expected to be drilled in 2019
Stewardship Over 50 onshore existing and producing oil and gas fields
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3737
The way forward
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
The OGA priority themes were set out in 2015 and were refreshed
in 2019 to refocus on the next five years with updated KPIs
KPI Area KPI Measure KPI Target Timing
1 Revitalise exploration Discovered recoverable reserves
200 mmboe additional recoverable reserves (5 year rolling average) Annual
2Enhanced
asset stewardship
Recoverable reserves 80 UKCS average production efficiency End 2022
3 Cost efficiency Maintain average UOC within +- 15 of the 2017 level (2017 prices) Annual
4 Regional development Resource progression 300 mmboe from 2C to 2P annually Annual
5Improve
decommissioning efficiency
Decommissioning cost 35 reduction in forecast total decommissioning costs from 2017 baseline estimate End 2022
6 Cost certaintyFor 90 of all assets an AACE class 3 estimate
(or better) should be submitted to the OGA at least three years before each planned decommissioning activity
End 2021
7 People processes and systems Staff engagement 5 percentage point improvement
in OGA positive engagement score End 2024
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
3838
MER UK Forum Steering Group and Task Forces
MER UK Forum
The MER UK Forum drives activities that support the principle objective of MER UK whilst fully supporting the
UKrsquos energy transition to net zero
Small focused membership includes industry task force leads ministers and officials Oil amp Gas UK and chaired by the OGA Others will be invited according to the agenda
Steers the task forces discusses and reviews strategic issues such as the UKrsquos energy transition Industrial Strategy collaboration and senior level
OGAindustry engagement
Six industry-led Task Forces focused on core areasand Industry Cultural Change Champion
MER UK Steering Group
Exploration
Technology Decommissioning Supply Chain and Exports
Supply Chain and Exports Task Force
Decommissioning Task Force
Technology Leadership Board
Exploration Task Force
Asset Stewardship Task Force
Efficiency Task Force
Asset Stewardship Efficiency
Industry Cultural Change Champion
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
393939
MER UK in actionCNOOC ndash Glengorm Discovery
Exp
lora
tion
bull First mapped over 20 years ago
bull Recoverable resources estimated at close to 250 million barrels of oil equivalent
bull Potential to be one of the largest discoveries on the UKCS since 2008
Total - Culzean
Dev
elop
men
t
bull Production started in June 2019 ndash ahead of schedule and gt10 under initial budget
bull At plateau production estimated to be responsible for circa 5 of UKrsquos gas needs
bull Estimated gas reserves of about 250-300 million barrels of oil equivalent
bull Carbon impact minimised during commissioning phase through close cooperation between Total and the OGA
Siccar Point Oil and Gas Technology Centre
Tech
nolo
gy
bull CAN-ductor ndash subsea well conductor
bull Potential to cut well construction time costs and enable complex drilling solutions
bull Piloted by Siccar Point Energy in the UKCS
CNS Hub
Asse
t Ste
war
dshi
p
bull Operator requested Cessation of Production (COP) but held to account by OGA stewardship process as hub strategy absent vintage seismic remaining resource potential JV misaligned
bull As a result of OGA refusing to consider COP ndash New hub strategy developed
seismic purchased infill drilling programme planned JV better aligned and life extension underway
Collaborating amp Connecting
Supp
ly C
hain
bull Oil amp Gas Pathfinder ndash contracts being awarded as a result of operators providing information
bull Hackathons ndash evidence of operators adopting solutions generated
bull SNS Well PampA Forum ndash innovative collaboration between SNS operators sharing information
BP and SaipemMiller Topsides
Dec
omm
issi
onin
g
bull Removal cost was ltp50 Northern and Central North Sea benchmark of pound42ktonne
Dev
elop
peo
ple
pro
cess
es a
nd s
yste
ms
bull Competitive cost due to ndash rapid development of expertise and
execution efficiency and the increase of ownership of the supply chain
ndash collaborative management approach between operator and supply chain
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
4040
Director ofOperations
Gunther Newcombe
Director of Strategy
Hedvig Ljungerud
Director of HR and Supply Chain
Stuart Payne
Chief Financial Officer
Nic Granger
Dr Andy Samuel
ChiefExecutive
Executive team
Chief Executive
Dr Andy Samuel
Non-Executive Director
Robert Armour
Company Secretary and General Counsel
Dr Russell Richardson
Chief Financial Officer
Nic Granger
Tim Eggar
Chairman
Acco
unta
ble
to B
EIS
Secr
etar
y of
Sta
te
Non-Executive Director
Mary Hardy
Board of Directors and Company Secretary
Non-Executive Director
Frances Morris-Jones
Director of Regulation
Tom Wheeler
Experienced leadershipD
evel
op p
eopl
e p
roce
sses
and
sys
tem
s
Shareholder Representative
Director
Emily Bourne
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
41
Exploration and production including Oil and gas policy includingOffshore onshore (England) carbon storage gas storage and gas unloading licensing
OGA
Environmental aspects of onshore regulations SERG
Field development plan consents OGA
Cessation of production approvals OGA
Offshore pipeline works authorisation OGA
Infrastructure OGA
Commercial matters and changes of control OGA
Flaring and venting consents OGA
Metering and allocation OGA
Production outages OGA
Offshore decom efficiency costs technology OGA
Offshore decom programme approval execution and monitoring BEIS ndash OPRED
Offshore environmental management and inspection BEIS ndash OPRED
Health and safety management HSE
Supply chain action plans OGA
Overall oil and gas policy BEIS
Legislation BEIS
Oil and gas parliamentary processes BEIS ndash OGA shareholder team
Offshore decommissioning BEIS ndash OPRED OGA HMT
Fiscal and taxation
HMT The OGA provide expertise and evidence to HM Treasury
Supply chain and business impact BEIS amp OGA
Environment BEIS ndash OPRED
International relations and tradeBEIS DIT OGA FCO
Key
BEIS Department for Business Energy and Industrial Strategy
DIT Department for International trade
FCO Foreign and Commonwealth Office
HMT Her Majestyrsquos Treasury
OGA The Oil and Gas Authority
OPRED Offshore Petroleum Regulator for Environment and Decommissioning
SERG Shale Environmental Regulator Group (Oil and Gas Authority Health and Safety Executive and Environment Agency)
Who does what in UK government
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
42
Key publicationsNew stewardship regime Worked with industry to develop 10 expectations and implementation guides spanning the whole lifecycle and the stewardship review process
Strategic overview Published with industry sector strategies setting direction
Asset Stewardship Expectations
Southern North Sea Tight Gas
June 2017
Strategy
Collaborative Behaviour Quantification Tool Assessment Guidance Note
April 2017
Asset Stewardship Expectations
Asset Stewardship Expectations
Guidance
March 2017
StewardshipReview
Asset Stewardship ExpectationsThe Maximising Economic Recovery Strategy for the UKAs reproduced by the OGA
Department forBusiness Energyamp Industrial Strategy
Asset Stewardship Expectations
OGA Annual Reportand Accounts
2017-18 (for the year ended 31 march 2018)
HC 1371April 2019
OGA Corporate Plan 2019 - 2024
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
2345678910
Stewardship ExpectationsOverview
1
July 2019
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
A Where a Stewardship Expectation includes a reminder of a licence or other statutory obligation such obligation will have binding legal effect
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20192345678910
StewardshipExpectations Overview
1
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK Strategy
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
Stewardship Expectations Overview
MER UK Strategy
1Joint Venture Hub Strategy
Stewardship Expectation 1
July 20192Delivering Exploration and Appraisal Work Programmes
Stewardship Expectation 2
July 20193Optimum Use of Subsurface Data
Stewardship Expectation 3
July 20194Well Activity Performance
Stewardship Expectation 4
July 20195Robust Project Delivery
Stewardship Expectation 5
July 20196Integrated Field Management
Stewardship Expectation 6
July 20197Commercial Alignmentand Delivery
Stewardship Expectation 7
July 20198Technology Deployment
Stewardship Expectation 8
July 20199Build a Culture of Collaboration
Stewardship Expectation 9
July 201910Cost EffectiveDecommissioning
Stewardship Expectation 10
July 201945678910
StewardshipExpectations Overview
July 2019
OnlineA5 paperOnline
Figure 1 Document structure
8 The OGA may review and refresh these SEs at a point in the future as part of continuous improvement and to ensure they remain relevant
9 The SEs are not intended to have a binding legal effect but rather set out for industry operating across the oil and gas lifecycle expectations which if followed will help to facilitate delivery of the MER UK StrategyA
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
43
All OGA publications can be found at httpswwwogauthoritycouknews-publicationspublications
Sector wide data The OGA provide reports including reports using data from the annual stewardship survey to help industry improve and benchmark performance
Guidance Worked with industry to provide guidance on our powers and how they are being used which can be found at httpswwwogauthoritycouk regulatory-frameworkguidance
Lessons Learned from UKCS Oil and Gas Projects 2011-2016
Asset Stewardship Expectations
UKCS Production Efficiency in 2016
June 2017
UK Continental ShelfUnsanctioned Discoveries Information PackUKCS Production Efficiency in 2016
June 2017
UKCS Production Efficiency in 2016
June 2017
Recovery FactorBenchmarkingUKCS Production Efficiency in 2016
June 2017
UK Continental Shelf (UKCS) Oilfields
September 2017
Asset Stewardship ExpectationsUK Oil and Gas Reserves and ResourcesAs at end 2016
Asset Stewardship ExpectationsSNS Salting Study
As at end 2016
Impact of Salt Deposition on Production Losses
Asset Stewardship Expectations
Gas-to-wire UK SNS amp EIS
UKCS Production Efficiency in 2016
June 2017
Wells Insight Report 2018
UKCS Production Efficiency in 2016
June 2017
UKCS Operating Costs in 2017
October 2018
Asset Stewardship ExpectationsGuidance
Online digital The OGA has range of online resources and tools to aid performance benchmarking and promote transparency
Production Efficiency Dashboard
Petroleum Production Reporting System
Technology Insights Portal
Decommissioning Dashboard and benchmarking
UKCS operating costs 2018March 2019
Projections of UK Oil and Gas Production and Expenditure
UKCS Decommissioning
July 20192019 Cost Estimate Report
UKCS Technology Insights
April 2019
Date of publication July 2019
Wells Strategy
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF
Copyright copy Oil and Gas Authority 2019
wwwOGAuthoritycouk
Contact us atogacorrespondenceogauthoritycouk
twittercomogauthoritywwwlinkedincomcompanyoil-and-gas-authority
OGA London Office 4th Floor 21 Bloomsbury Street London WC1B 3HF
OGA HeadquartersAB1 Building 48 Huntly Street Aberdeen AB10 1SH
Oil and Gas Authority is a limited company registered in England and Wales with registered number 09666504 and VAT registered number 249433979 Our registered office is at 21 Bloomsbury Street London United Kingdom WC1B 3HF