This is set to be a pivotal year for the oil and gas industry.
A period of inevitable and transformational change lies ahead, largely influenced by the UK’s legally binding net zero emissions target.
In September, the Committee on Climate Change (CCC) will publish its Sixth Carbon Budget, setting direction for the UK to reach net zero, and towards the end of the year Glasgow will host the COP26 climate summit, where governments from across the world will offer up their pledges to tackle the climate emergency.
The spotlight is on the UK this year and this increased attention offers the ideal chance to showcase what is being done here to cut CO2 emissions and inject more pace into the transition to clean energy sources.
Oil and gas will remain an important part of our energy mix in the transition to net zero. However, there is a massive responsibility on the industry to produce more cleanly and efficiently. A significant opportunity to accelerate this transition is by more closely integrating different forms of offshore energy production, sharing infrastructure and leveraging operational synergies.
The OGA has been leading the UK Continental Shelf (UKCS) Energy Integration Project in collaboration with BEIS, Ofgem and The Crown Estate to look at the full value of the UK offshore basin as an integrated energy asset. Five technology concepts were looked at, all with the potential for industry to lower its carbon footprint. The project’s interim findings show that integration between oil and gas, renewables, hydrogen and carbon capture and storage (CCS) can accelerate the energy transition and unlock value for the UK economy.
Opportunities for energy integration in the UKCS are plentiful and diverse. For instance, the UK has extensive oil and gas infrastructure and capabilities, offering significant storage and transport potential, as well as considerable wind power potential.
Scaling up these energy concepts to larger energy hubs could support the growth of hydrogen as an efficient energy storage and transportation solution. Hydrogen, generated from either natural gas reforming or by electrolysis using renewable power, may be stored in reservoirs close to these hubs and transported to the market – repurposing the existing oil and gas infrastructure.
Many options in the report can be delivered with proven technologies. CCS has already been piloted internationally and is considered essential in all UK decarbonisation scenarios.
Work is now under way for phase two of the UKCS Energy Integration Project. It will be completed later this year and will include economic and regulatory assessments to identify barriers, opportunities and quick-wins for energy integration.
Over the next year the OGA will continue to work hard to deliver value for the basin, while working with government, industry and other stakeholders to support wider energy transition initiatives. Integrating the UK offshore energy sectors can help industry cut carbon emissions from oil and gas production and deliver the UK’s net zero target by accelerating the ramp-up of CCS and offshore renewables.
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