The industry regulator has launched an investigation into a potential breach of licence commitments by a North Sea operator.
An unnamed oil and gas firm is under investigation by the North Sea Transition Authority (NSTA) for potentially failing to stimulate activity in support of the UK’s energy security.
The investigation will consider whether the company under investigation was obliged, under the terms of a previously awarded permit, to shoot a seismic survey.
That would then have helped the firm to determine whether or not to drill an exploration well.
The NSTA will also study whether the licensee failed to provide a satisfactory alternative work programme to ensure progress on the acreage continued.
Once the facts have been collated, investigators will determine whether a sanction should be posed on the company – that could include a financial penalty of up to £1 million.
This is the second investigation opened by the regulator in recent months into a company suspected of failing to meet its licence commitments, such as shooting 3D seismic, within agreed timescales.
Companies with sought after acreage are expected to progress exploration and production as quickly as possible.
They are also obliged to “pursue economic recovery”, while assisting the government in the drive to reach net zero.
The NSTA is at the vanguard of the UK’s energy security push, with the results of the ongoing 33rd Licensing Round, which attracted 115 bids from 76 companies, expected later this year.
Jacob Blatch, NSTA interim head of disputes and sanctions, said: “The NSTA works closely with industry to drive forward exploration and production activities to help the UK meet as much energy demand as possible from its domestic oil and gas reserves.
“However, as opening this investigation demonstrates, we will scrutinise incidents where licensees potentially sit on licences and make no real progress on fulfilling obligations.”
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