Keep gas on the front burner

Meg Chesshyre
Tuesday, February 9, 2010

While a nationwide freeze and the world’s biggest windfarm licensing round hogged Britain’s headlines last month, Oil & Gas UK energy policy manager David Odling issued a timely reminder of the need to bolster indigenous gas production.

Calling on the government to further incentivise gas field investment, Odling said: ‘Oil & Gas UK believes that up to 1.5 trillion cubic metres of gas remain to be developed and produced from the UK continental shelf. Assuming domestic production and imports each satisfy half of our demand, this could last for some 30 years. However, gas projects must prove competitive enough to attract the required investment if these volumes are to be recovered.

While the new field allowance announced in the last UK Budget encouraged investment in some difficult fields, Odling urged that it be extended to apply more broadly – in particular to the remote West of Shetland region where a fifth of the country’s gas resources are estimated to lie (OE January). An extension of the allowance would help to attract the £2 billion investment required to bring this gas ashore, said Odling. In addition, a broadening of the rules around the new field allowance would promote investment in technically difficult gas and the reserves remaining in existing fields in the southern North Sea.

‘The ability of the UK gas market to respond to the recent cold snap and meet demand illustrates the importance of diversity in our gas supplies, which are in fact the most diverse in the European Union,’ Odling noted. ‘While additional storage capacity would play an important role in alleviating any tightness in the gas market during periods of high demand, it must not be forgotten that gas from under the seabed surrounding our own coastline should be our first line of defence.’

He called on the government to work with the industry to ‘rebalance the tax regime to ensure we make full use of our own resources’. OE

Categories: Renewables Europe Energy

Related Stories

Eni Sells Plenitude Share to Ares for $2.3B

Eni Sells Plenitude Share to Ares for $2.3B

Seequent Receives Award at Global Offshore Wind 2025, Hosts Upcoming Webinar

Seequent Receives Award at Global Offshore Wind 2025, Hosts Upcoming Webinar

Commodity Report: Meeting Oil Demand a Challenge if Israel Hits Iran Oil

Commodity Report: Meeting Oil Demand a Challenge if Israel Hits Iran Oil

Current News

ABS: Floating CO₂ Injection Facilities Report

Iran’s Top Security Body to Weigh In on Strait of Hormuz Closure

Gimi FLNG Enters Commercial Ops at BP’s GTA Project off Western Africa

Aibel to Provide Maintenance Services for Two Vår Energi’s Oil and Gas Fields

Subscribe for OE Digital E‑News

Offshore Engineer Magazine