LNG

The North Sea Transition Authority (NSTA), the UK regulator seeking more oil and gas exploration and production in British territorial waters that will affect future import needs for pipeline gas, LNG and oil has offered a total of 24 licences in the second tranche of the 33rd oil and gas licensing round.

The North Sea Transition Authority (NSTA), the UK regulator that is launching renewed oil and gas activities in British territorial waters that will affect future import needs for pipeline gas, LNG and oil has issued an Area Plan for cross-licence and cross-Hub collaborative frameworks to ensure maximum recovery of oil and gas in six areas.

The six areas where oil and gas activities will take place are the Central North Sea, the Northern North Sea, the Southern North Sea, West of Shetland, East of Shetland and the East Irish Sea.

The NSTA, formerly known as Oil and Gas Authority, had previously drawn up a “Maximising Economic Recovery of UK Petroleum (MER UK) Strategy” with added “behavioural Guidelines” written by the industry for the industry and aimed at helping all participants.

The report estimates that the effective use of Area Plans has the potential to unlock around 4 billion barrels of resources.

Working with operators

“The NSTA is working closely with operators, licence holders and other interested parties to develop Area Plans across the oil and gas life cycle,” said the report.

“These integrate exploration, development, production, and decommissioning to ensure operations ensure economic recovery with the optimum use of infrastructure to extend asset life,” the NSTA added.

The NSTA explained that Area Plans, like industry, are evolving with scopes of work now incorporating energy integration and net-zero considerations.

“Area Plans represent a shared view amongst industry participants of the optimal way to ensure economic resource recovery,’ said the report.

“For the majority of Area Plans, the NSTA will normally expect industry to lead on developing and delivering the plans,” it stated.

The NSTA has developed Guidance (revised in November 2023) to aid the industry’s understanding of their responsibilities for developing Area Plans and help improve collaboration across the UK Continental Shelf.

Updates

“As experience and practice develop, the NSTA will update and review this guidance,” it said.

Under the leadership of Steve Phimister, Industry Cultural Change Champion, the “Behavioural Guidelines” have been created to help those involved in Area Plans.

These Guidelines provide advice, share insights from existing Area Plans groups and signpost to relevant tools and resources.

The Guidelines are categorised into four “Area Plan Essentials”: 1.) Create the Right Environment; 2.) Secure the Right People at the Right Time; 3.) Clarify the Boundaries for Collaboration; and 4.) Agree an Appropriate Decision Process.

The full report is available on the NSTA Web site.

The United Kingdom, one of Europe’s largest liquefied natural gas importers and with new natural gas projects planned for the North Sea, is set to roll back and delay Net Zero emissions policies with Prime Minister Rishi Sunak declaring that Britain’s new response to the climate change dilemma has to be a “proportionate” one rather than being imposed on ordinary people by an elite minority, personified by Sunak himself who is a former investment banker with a vacation home in Santa Monica, California.

June 28 (LNGJ) - The North Sea Transition Authority (NSTA), the UK government offshore energy body, has pledged to continue natural gas and oil production in the North Sea rather than letting the region become solely a dumping ground for carbon-dioxide under projects being pushed by anti-hydrocarbon lobbyists.

   The NSTA assured the oil and gas industry at a forum that it was working to progress more than 21 projects capable of producing 1.5 billion barrels of oil and gas, while awards from the UK’s 33rd oil and gas licensing round are expected later in 2023. The UK government tried to assure the industry that it was also moving to put a price floor on the Energy Profits Levy (EPL) to boost investor confidence and encourage investment in oil and gas projects with more costly emissions reduction technologies.

Delek Group, whose stakes in the offshore Leviathan and Tamar natural gas fields in the East Mediterranean make it a major supplier to Israel, Egypt and Jordan, posted a quarterly net loss as it prepares to welcome new partner Chevron and a possible LNG project after the US major’s agreed acquisition of Noble Energy.

The Tamar and Leviathan fields in Israeli territorial water have combined reserves of around 30 trillion cubic feet of gas

Delek Group said it ended second quarter with a net loss of 326 million Israeli shekels ($97M), mainly arising from one-time accounting provisions.

Delek said the drop in energy prices and the lockdowns applied in Israel and around the world, the group’s revenues in the quarter were 1.94 billion shekels ($577M), similar to the corresponding quarter last year, driven by a sharp rise in the Group’s revenues from core operations offshore Israel and in the North Sea.

The group’s Delek Drilling subsidiary holds the natural gas stakes and it completed the refinancing of the Leviathan field with a $2.25 billion loan.

Delek Drilling has noted that in recent weeks, after the reporting period, there had been a “significant increase” in demand for natural gas.

Revenues from the sale of gas in Israel net of royalties rose by 64 percent in the second quarter to 498 million shekels ($148M) compared with revenues of 304M shekels in the same three months of 2019.

“The increase was mainly due to the start of gas production from Leviathan, and the sales to the local market as well as exports to Egypt and Jordan,” said Delek.

The major increase in sales of natural gas and condensate led to a growth in operating profit before one-time provisions were made.

Chevron agreed in July 2020 to acquire Houston-based Noble Energy and its assets in US shale basins and the East Med, including the Leviathan and Tamar fields.

The definitive agreement valued at $5Bln between Chevron and Noble has been approved by both boards and is expected to close in the fourth quarter.

Delek Drilling has said the acquisition could mean the development of LNG export project.

“Chevron brings a significant LNG capability into the Leviathan project,” the Israeli company said at the time.

Delek also runs a UK North Sea oil and gas business through its subsidiary Ithaca Energy.

The Israeli company said Ithaca’s revenues in the quarter were 971M shekels ($290M) compared with revenues of 350M shekels in the parallel quarter last year.

Delek said average daily output by Ithaca amounted to 70,400 barrels of oil equivalent per day compared with 15,200 boe/d in the same quarter of 2019.

Delek had acquired the North Sea fields from new East Med partner Chevron.

The company’s provisions in the earnings came in relation to the disposal of two subsidiaries, Cohen Development and Phoenix.

As the quarterly results were announced, Delek noted that Bill Dunnett had been appointed as CEO of Ithaca.

Dunnett, an engineer by training, has 35 years of experience in the field of energy and gas, during which time he served as CEO of Repsol Sinopec Resources UK and in a range of senior positions in leading energy companies, including Shell, Petrofac and Halliburton.

“Delek Group’s core operations continued to demonstrate strong performance in the second quarter,” said Idan Wallace, President and Chief Executive of Delek Group.

“Major steps to strengthen both capital and collateral that the company completed during and following the reporting period, provide a tailwind to continue with the successful implementation of the Group’s strategy,” he added.