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UK government awards 27 new onshore oil and gas licences

18 August 2015

The Oil & Gas Authority, part of the UK Department of Energy and Climate Change, confirmed on August 18 that 27 licences from the 14th Onshore Oil and Gas Licensing Round had been formally offered to companies, giving the green light to large-scale shale oil and gas development in the UK.

A shale prospecting pad in the UK - Image: Cuadrilla
A shale prospecting pad in the UK - Image: Cuadrilla

IGas Energy PLC said it has been awarded six licences, covering seven blocks located in the Gainsborough Trough area in the East Midlands and including exploration prospects for both shale gas and conventional oil and gas, close to where the company has existing operations.

IGas is collaborating with Egdon Resources PLC and French oil major Total in four of these licence areas and will operate two alone. Egdon is also operating two alone.

INEOS Upstream has been offered three licence blocks for shale gas exploration covering 250 sq. km. in the East Midlands. It also has a number of blocks in Scotland, but the Scottish Government has imposed a moratorium on shale oil and gas development there.

Cuadrilla Resources has been offered two licences in Yorkshire, the South Cleveland basin and Gainsborough trough. The former licence is shared with GDF Suez E&P UK.

Hutton Energy Ltd was offered three new licences in addition to its existing licenses in the East Midlands bringing Hutton's interests in the UK to over 800 sq. km.

Other companies awarded licences, according to the Oil and Gas Authority, were Cirque Energy, Blackland Park Exploration, Aurora Energy, Osprey Petroleum and Warwick.

"With almost 100 applications received, the 14th Onshore Round has attracted significant interest and high-quality proposed work programmes from a range oil and gas companies.” Oil and Gas Authority Chief Executive Andy Samuel said.

UK energy minister Lord Bourne said: “As part of our long-term plan to build a more resilient economy, create jobs and deliver secure energy supplies, we continue to back our onshore oil and gas industry and the safe development of shale gas in the UK.

“Keeping the lights on and powering the economy is not negotiable, and these industries will play a key part in providing secure and reliable energy to UK homes and businesses for decades to come.

“It’s important we press on and get shale moving, while maintaining strong environmental controls. Investment in shale could reach £33 billion and support 64,000 jobs, whilst providing a cost-efficient bridge to lower-carbon energy use.”

The licences will be finalised after the habitats assessment consultation process has been completed.

A consultation has also opened on a second group of 132 sites - including parts of the West Country, south coast and parts of the north of England - which will last until September. 

These remaining blocks in the 14th Round are close to or in certain Special Areas of Conservation (SACs) and Special Protection Areas (SPAs) and will be subject to further environmental assessments before any offer is made. Announcements on this second tranche are expected later this year.

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