DTI offers new licenses in North Sea

For the first time since 1998 all of the North Sea will be open for oil and gas exploration with a record breaking 1,329 blocks on offer in the 23rd Offshore Oil and Gas Licensing Round, UK Energy Minister Mike O'Brien announced.

More than 50 previously fallow blocks will be on offer in this round that were not available in the previous round demonstrating that the government and industries 'Fallow initiative' to stimulate activity in the North Sea is working.

The government's recent innovations in licensing will again be available in this round with the new Frontier and Promote license being offered alongside the more traditional type license.

UK Energy Minister Mike O'Brien said: "The innovative Promote and Frontier licenses that we introduced in recent years, and which are on offer in this round, mark another milestone in our commitment to exploit the UK's oil and gas resources on the UK continental shelf. This 23rd License Round includes new areas that have not been available for some years. Together with the results coming out from the Fallow initiative, this reflects the government's drive to developing and sustaining this vital industry and the jobs that come with it."

Recognizing the particular challenges in the West of Shetland region, the Frontier license is only on offer in this area, whilst the Promote license is offered in areas excluding the West of Shetland. The Traditional license will apply to all regions.

Under the Frontier and Promote licenses, the rental fee will be cut by 90% for the first two years compared to the rate for a Traditional Production license. This, together with the extended exploration and development periods on the Frontier license, will give companies an added incentive to find oil and gas in new regions.

03/11/05