UK to Grant Over 100 North Sea Oil and Gas Licenses

Credit: Rob/AdobeStock
Credit: Rob/AdobeStock

Britain will grant more than 100 new oil and gas licences in the North Sea as part of efforts to tap domestic supplies and become more energy independent, the government said on Monday. 

Prime Minister Rishi Sunak said the move was compliant with the government's environmental targets, with around a quarter of the UK’s energy demand due to still be met by oil and gas when the UK reaches net zero in 2050. 

Sunak said the new licenses would support domestic supply, reduce reliance on hostile states, boost jobs in the sector and reduce the carbon footprint when compared with an alternative option of importing liquified natural gas. 

The government also announced plans to set up two new carbon capture usage and storage clusters in Scotland and northern England

"As the UK is a rapidly declining producer of oil and gas, new oil and gas licences reduce the fall in UK supply in order to ensure vital energy security, rather than increase it above current levels – so that the UK remains on track to meet net zero by 2050," the government said. 

Sunak is due to visit an energy infrastructure site in Scotland later on Monday. 

The oil and gas industry regulator expects the first of the new licenses, which will continue to face climate compatibility tests, to be awarded in the autumn, the government said. It also said the new licenses could be offered close to already licensed areas to unlock oil and gas reserves faster thanks to existing infrastructure and previous assessments.

 The announcement highlights the difference between Sunak's Conservatives and the opposition Labour Party, which opinion polls suggest is on course to win a national election expected next year. It has pledged to stop new oil and gas exploration licenses in the North Sea.

 (Reuters - Reporting by Sachin Ravikumar; editing by Sarah Young and Kate Holton)

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