ENERGY NEWS
11
APRIL 2022
UK NORTH SEA
Energy Review By Tsvetana Paraskova
The oil and gas authority’s name change to reflect efforts in the energy transition, the state of the North Sea offshore industry in the wake of the Russian invasion of Ukraine, and a number of field development updates featured in the UK North Sea oil and gas news flow this past month.
The UK Oil and Gas Authority changed on 21 March its name to the North Sea Transition Authority (NSTA) to reflect its evolving role in the energy transition. The NSTA will continue to play a vital role in ensuring energy security as the body which stewards the oil and gas industry, both on and offshore, with energy transition issues already playing a significant and increasing role in the organisation’s day-to-day activities. “Investment in the North Sea is therefore vital, but the increasingly polarised debate shook industry confidence, putting billions of pounds worth of capital expenditure at risk,” said Dr Andy Samuel, Chief Executive of the North Sea Transition Authority. “The UKCS can still attract investors and is open for the right business. We are stewarding a good number of oil and gas developments in line with our net-zero test, ensuring cleaner production, while bolstering energy security and giving the UK options,” Samuel added. The UK’s underwater industry generates revenues of £7.8 billion, 43% of which are attributable to exports, and directly and indirectly employs 45,000 people. Emerging sectors such as offshore floating wind, CCUS, and hydrogen production offer future growth potential and opportunities to support the UK’s energy transition and net-zero ambitions, the Global Underwater Hub said in a white paper in March. A significant contributor to the UK economy, the industry directly supports £11 billion of gross value add (GVA) per annum. “With its market leading position, the UK’s underwater industry is arguably one of the country’s biggest opportunities for growth over the next 15 years, and one that can help accelerate our net-zero ambitions,” the paper reads. “The UK’s underwater supply chain SMEs, the backbone of innovation in addressing industry demand, are driving forward capabilities which are highly transferable into marine and offshore renewables and other sectors,” according to the paper. Flaring in the UK North Sea fell by 19% in 2021, building on a 22% decrease the previous year, new analysis by NSTA showed in early March. Production facilities cut their flaring by 6 billion cubic feet (bcf), to 26 bcf, a reduction equivalent to the annual gas demand of 130,000 UK homes.
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It means that offshore flaring volumes dipped to their lowest annual level on the authority’s records, while an all-time monthly low was set in June 2021. “As we transition, the UK needs a stable supply of domestic oil and gas to minimise reliance on imports and bolster energy security. To ensure that production is as clean as possible, the OGA is holding the sector to account, including on flaring and venting, through close monitoring and benchmarking and proactive stewardship,” NSTA’s Samuel said.
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