oil gas uk development dti

8/7/2019 oil gas uk development dti

1/27

www.og.dti.gov.uk

OG-LED AND THE UK ONSHOREOIL AND GAS INDUSTRY

GEOFF SWANNSENIOR GEOLOGIST

DEPARTMENT OF TRADE AND INDUSTRY


2/27

www.og.dti.gov.uk

Purposeofthe talk

Explain role of OG-LED

Highlight selected issues

Demonstrate that there is a future for the

onshore oil and gas industry

Regulation

Promotion

(Oil and Gas - Licensing, Exploration and Development)


3/27

www.og.dti.gov.uk

The new OG-LED organisation and its

objectives

The licensing system Web services and data release

Environmental issues

Coalbed methane and mines gas

Agenda


4/27

www.og.dti.gov.uk

Wheredoes OG-LED fit in DTI?


5/27

www.og.dti.gov.uk

DTI

Ann Eggington

Markets and Policy

Jim Campbell

Environment &

Decommissioning

Ian Todd

Industry Support

Stewart Robinson

IT

Stephen Byers

Secretary of State for Trade and Industry

Peter Hain

Minister for Energy & Competetiveness in Europe

Sir Michael Scholar KCB

Permanent Secretary

AnnaWalker

Director General Energy

GeoffDart

Director Oil and Gas (OG)

Simon Toole

Director OG-LED


6/27

www.og.dti.gov.uk

OG-LED

Exploration

Team

Northern

Area Field

Team

(Aberdeen)

Peter Haile

Promotion Team

Knowledge Team

(data)

&

Onshore

Exploration &Development

Central Area

Field Team

Southern

Area Field

Team

Merged exploration and development into a single team

Simon Toole

Director OG-LED

Mike Hawkins

Licence

administration


7/27

www.og.dti.gov.uk

OGsobjectiveis to

To maximise the economic benefit to the UK of

its hydrocarbon resources, taking into account

the environmental impact of hydrocarbondevelopment, and the need to ensure secure,

diverse and sustainable supplies of energy for

business and consumers at competetive prices.


8/27

www.og.dti.gov.uk

Objectivesfor 2010 (OGITF Targets)

Production at 3 million barrels of oil

equivalent per day

Investment in UKCS activity sustained at3 billion per annum

Commitment to prolonged self sufficiency

in oil & gas


9/27

www.og.dti.gov.uk

UK onshore fields produce c 31 mmboe pa butsome 25 mmboe is from Wytch Farm *

(* 2001 Brown Book operators estimate of peak production. Does notinclude fields in Mining Licences)

Howdoes theonshorefit in?


10/27

www.og.dti.gov.uk

Benefitsofthe UKonshoreindustry

Employment

Regeneration - especially in coalfield areas

Local power/gas supply

Technology export and spin-offs

Environment


11/27

www.og.dti.gov.uk

The Licensing System

Current status

Future plansOut-of-Round licence awards


12/27

www.og.dti.gov.uk

Onshore

licensed

areas


13/27

www.og.dti.gov.uk

ML 7 188 km2

Current onshore licences:

AL 4 205 km2

DL 5 42 km2PL 28 1733 km2

EXL 37 6342 km2

PEDL 97 24483 km2

TOTAL 178 32992 km2


14/27

www.og.dti.gov.uk

0

2

4

6

8

10

12

14

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

I

I

V

I

Wells anddiscoveries 1990 - 2000

BeckeringPickering

Saltfleetby

Airth

Fiskerton

Airfield

Cold

Hanworth

Keddington

Newton on

Trent

Reepham Cowden

Lingfield


15/27

www.og.dti.gov.uk

Healthy licensing position - we want to keep it that way

Range of new developments from mines gas to

Saltfleetby

Successful 9th Round - 43 licences issued Continued interest for both conventional hydrocarbons

and cbm/mines gas

Need more drilling activity

Encourage new entrants Looking for operators to explore new potential

Summary


16/27

www.og.dti.gov.uk

OG-LED intends to hold a 10th Round in late

summer/autumn (depends on 20th offshore Round timing)

Discourage acreage banking

Review to ensure licensed acreage is being explored

No waivers on firm wells

Drill or drop options will be enforced

No extensions to PEDL initial terms

PEDL 2nd terms - need development plan approved

before 3rd term commences (no extensions)

Consider changes to model clauses / regulations

Want to remain flexible - what does industry want?

Futureplans


17/27

www.og.dti.gov.uk

Out-of-round awards

Only made in exceptionalcircumstances

Generally require 90 day OJ notice

Can be restricted to adjacent licensees Not a back-doorroute to acreage

To facilitate development

Operational reasons


18/27

www.og.dti.gov.uk

Webservices

DTI would encourage an onshore website

DEAL - data market place

Web based licence assignment system - by

end 2001

Onshore well and licence data on DTIs

website


19/27

www.og.dti.gov.uk


20/27

www.og.dti.gov.uk


21/27

www.og.dti.gov.uk


22/27

www.og.dti.gov.uk


23/27

www.og.dti.gov.uk


24/27

www.og.dti.gov.uk

Data Release

UKOGL - a continuing success. Library will

continue to be supported by DTI. Is there

scope for similar initiatives?

Can we publish licence applications and/or

reports?

Need agreement from old and existing licensees

What formats would we use (cost)?

Available for inspection (and copying)?


25/27

www.og.dti.gov.uk

Environmental issues

Legislation administered by DETR, EA/SEPA and local

authorities

OG-LED has an advisory role

Landfill Directive - reinjection of third party liquid waste

will be prohibited

Foot and mouth - follow MAFF/local authority guidelines

PEDL doesnot giveright ofaccess

OG-LED will be flexible over drilling andseismic commitments


26/27

www.og.dti.gov.uk

Coalbed Methane& Mines Gas

Petroleum Exploration and Development Licence vs

Methane Drainage Licence

MDL - for mine safety purposes only: DTI will not

compromise safe working practices

MDL does not give right to drill for gas but PEDL

holder can not drill over or near a mine

PEDL and MDL holders should reach agreementwithout DTI intervention

DTI will not tolerate back door developments


27/27

www.og.dti.gov.uk

Want to know more?

Geoff Swann

020 7215 5062

[email protected]

www.og.dti.gov.uk

Documents

oil gas uk development dti