LONDON (Reuters) – Britain has cut rental rates up to 90 percent in the last auction of licenses for oil and gas in the North Sea launched on Wednesday in a bid to attract businesses to find new fields in the mature basin.
companies can now apply for cheaper and more flexible licenses to access the 1,261 blocks of October 26, followed by awards license issued by the Oil and Gas Authority (OGA) at a later date.
It is expected that the search for new oil and gas in the British part of the North Sea fell to the lowest level in 45 years this year as energy companies have cut exploration budgets because oil prices weak .
Despite being an old basin, the British North Sea is estimated to be billions of barrels left to extract, worth about 200 million pounds (262.56 million dollars) to the coffers of the British government.
The latest round of licenses, the 29th, provides access to new areas in Rockall Trough mid offshore North and East of Shetland, which were subjected to a campaign of seismic tests funded by the government earlier this year.
“We are aware that market conditions are currently very difficult, but nevertheless, we have a common goal to make the basin as attractive as possible for exploration,” Andy Samuel, executive director of the OGA he said.
The change in contracts Authority Oil and Gas will reduce rental rates licensing in some cases up to 90 percent per square kilometer and allow explorers more flexibility in terms of when you can carry out certain programs work.
The companies that obtained licenses in the bumper 28 licensing round last year, Britain’s largest ever, including Shell (L: RDSA) and Eni (MI: ENI).