OGA fines bp for lax North Sea well test reporting

July 27, 2021
Britain’s Oil and Gas Authority has fined bp £50,000 ($68,894) and served the company with a Sanction Notice.

Offshore staff

LONDON – Britain’s Oil and Gas Authority (OGA) has fined bp £50,000 ($68,894) and served the company with a Sanction Notice.

The measures are in response to the company breaching a condition for a license in the North Sea by failing to report progress and results of two extended well tests (EWTs).

The OGA had authorized the EWTs on two wells in August 2019, with the proviso that bp should provide regular reports during operations, and present a full report of the results within 90 days of completion of the operations.

For each well, bp was expected every Friday to report on daily rates of production, volumes produced and flared during testing, wellhead pressures, cumulative petroleum production amounts, also providing details of water cuts, downhole pressures and gas-oil ratios and any problems encountered.

Last November, following an OGA enquiry, the company admitted that it had failed to report as required. Its internal investigation revealed a breakdown in communications with no guidance in place for managing OGA consents, and a lack of awareness among engineers of the consent requirements.

This unintentionally created an unregulated environment that could have exposed bp to a potential flaring breach, of which the OGA would not have been aware and therefore unable to take prompt regulatory action – although no flaring breach occurred.

The sanction follows publication last October of the Authority’s Thematic Review into Industry Compliance with Regulatory Obligations.

While the review recognized that the industry was improving in terms of compliance, it also noted room for improvement in managing production, flare and vent consents and the timing of license extension requests.

Jane de Lozey, OGA Acting Director of Regulation, said: “On this occasion bp has fallen short of our expectations but, since becoming aware of the breach, bp has engaged positively with the OGA to investigate the cause of the failure and reaffirmed its commitment to compliance with its regulatory obligations in future.

“We will continue to work with industry to improve compliance, and we are currently considering other matters within the UKCS that may result in further regulatory action.”