The UK oil and gas regulator North Sea Transition Authority (NSTA) warned the industry on Friday that it would not hesitate to take action against companies that fail to meet their license obligations.
"An investigation has been opened into whether a company, which was awarded a licence in the 28th Licensing Round in 2014, has failed to comply with several obligations, including drilling an exploration well and shooting a 3D seismic survey," NSTA said.
"The NSTA is committed to supporting the UK’s drive for energy security and expects companies awarded valuable North Sea licenses to progress exploration and, where appropriate, production as quickly as possible," the regulator added.
The current investigation will examine the situation surrounding the license, which had been previously extended, and in light of changes to company ownership, NSTA said, The regulator did not share the identity of the company being investigated.
"Dependent upon the results of the investigation, a fine of up to £1million could be levied if the company is found to have failed to meet its obligations," NSTA said.
"Oil and gas licenses are routinely awarded with conditions attached requiring the licensee to undertake certain actions within agreed timescales. The NSTA has produced a wide range of guidance to assist companies in meeting licence and regulatory requirements, and ongoing stewardship provides additional support," NSTA explained.
Jane de Lozey, NSTA Interim Director of Regulation, said: “Ensuring the UK’s energy supply is vital, so it is important that companies meet their licence obligations and progress projects as quickly as practicable. The NSTA is committed to ensuring the growth of the UK’s energy supply and will not hesitate to take action in cases where companies fail to meet their obligations.”