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New Initiative to Boost Recovery of UK Oil and Gas Reserves
| Date: | 05 Mar 2002 | | Details: | A new initiative was announced today to maximise recovery of Britain's remaining oil and gas reserves. The package of measures will remove barriers preventing exploitation of the UK's estimated remaining 26-34 billion barrels of oil equivalent (boe).
Energy Minister and chair of PILOT, Brian Wilson, said: "This excellent initiative results from frank discussions between the operators, contractors, suppliers and Government through PILOT. Today's announcement heralds a new era of unprecedented collaboration between the whole range of offshore oil and gas sectors.
"It is essential to have the right licences in the right hands at the right time. We are moving towards that objective on a very encouraging consensual basis.
"The "Progressing Partnership" initiative is a range of radical and innovative measures to stimulate activity, speed up negotiations and reduce costs. This is the way to maximise recovery of the UK's remaining reserves and expand future prospects for the UKCS."
These include a review of licence holding, steps to speed up asset trading, two new codes of practice - one for licence holders and the other for supply chain partnership - and some standardisation of commercial agreements.
The new measures include:
1. Tighter conditions on licences to promote active exchange of licences and ensure that acreage and potentially economic developments do not lie fallow;
2. Changes to pre-emption provisions to speed up asset trading and encourage new players into the UKCS;
3. Two new codes of practice - for licence holders and supply chain partnership; and
4. Standardisation of commercial agreements.
The "Progressing Partnership" initiative was set up a year ago under PILOT, the joint Government Industry body promoting greater competitiveness in the North Sea.
The measures address the commercial structure of the Industry and have been endorsed by Industry leaders and the Department of Trade and Industry through PILOT. They will be rolled out to the rest of the oil and gas sector at a series of seminars and exhibitions throughout the coming months.
Paul Blakeley, co-chair of the Industry Leadership Team (ILT) within PILOT and general manager of Talisman Energy UK, said:
"Many of the Industry's practices today are based on methods of working that were effective for delivering the huge oil and gas projects of the 1970s and '80s. While there is still the potential to produce as much oil and gas again as we have to date, the future is not going to mirror the past. We will have to change radically the way we do business if we are to access efficiently and effectively these reserves which lie in smaller, more complex reservoirs."
Tom Botts, managing director of Shell Expro, said: "I've been very impressed with the spirit and determination of companies big and small, both operators and contractors, working closely with government to create the changes we all need to make the UKCS more competitive. The "Progressing Partnership" effort is a great example of what PILOT can deliver."
Sir Ian Wood, ILT co-chair and chairman of the John Wood Group, said: "A key outcome of the Progressing Partnership work is the Codes of Practice for licence holders and the supply chain. These should facilitate the relationships and conduct of business between the key North Sea stakeholders and will enhance commercial activity. The codes improve standards, transparency and commitment and are intended to make the UKCS a more efficient and profitable place to do business." | | Contact: | Trisha O'Reilly, PILOT Communications
Tel: 020 7802 2422
Email: toreilly@ukooa.co.uk |
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For all press enquiries please contact:
Trisha O'Reilly at UKOOA Tel: 0207 802 2422 Email: toreilly@ukooa.co.uk
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