The oil and gas watchdog hailed a “really positive” North Sea licensing round despite a much smaller number of companies applying for acreage this year.
The Oil and Gas Authority (OGA) revealed that 24 companies had applied for licenses covering 113 blocks in the 29th licensing round.
The firms, which included oil giant BP, made 29 applications. Last year the OGA awarded 175 in one of the largest rounds since offshore licensing began in 1964.
The OGA highlighted that the round this year was focused on “frontier” areas for the first time in 20 years.
The areas included the Rockall Trough and mid-North Sea High, which were the focus of a £20million programme of seismic data gathering surveys last year.
Nick Richardson, head of exploration and new ventures at the OGA, insisted the results were “really positive actually”.
He added: “It is not much use comparing to the previous round because in those we tried to license all acreage in the UKCS but here we have been much more targeted in what we have offered.
“Personally I am very pleased with it especially given the context of the global business and the constraints everyone is under.
“The fact there are so many companies of different sizes willing to apply for acreage in they UK is a good thing.”
The regulator will award the licenses to companies next year and Mr Richardson expects the firms will begin drilling some of the licenses in the next three to five years – with more to come in future rounds, he said.
“This is the first stab at licensing in these areas,” said Mr Richardson.
“Companies will want to come back when they do more work. As time goes on we will license more and more of it.”
He added that he expects next year’s round – the 30th – will be “competitive” as it extends to the wider UKCS again. Several licences have also been handed back to the OGA by companies that have either gone bust or can no longer afford to develop them.
He said: “The mature area round next year will offer companies lots of opportunities.
“We have had lots of acreage relinquished to us over the course of the year. There will be some substantial areas of quite high interest to industry. That will be quite a competitive round I think.”
BP bid for seven licences as part of the 29th round which it said maintained “the impetus generated by our recent licence round applications”.
“This, coupled with the four to five exploration wells we intend to drill next year, underlines both our commitment to the North Sea and also our excitement around future resource options,” the firm added in a statement.
Andy Samuel, chief executive of the OGA, said: “Despite the difficult climate, industry has responded strongly to our offer, using analysis and insights to identify new prospects and submit high quality applications on blocks that did not attract interest in recent licensing rounds. This confirms the high remaining potential in the UKCS’ frontier areas.
“Long standing investors continue to seek new acreage and we also welcome the arrival of new entrants. This is encouraging and supports the OGA and MER UK Exploration Board’s joint approach to revitalise exploration. The UK Government funded seismic programmes and the OGA’s ‘Innovate Licence’ were developed through an industry task group and offer a flexible, pragmatic and focused approach to licensing.
“Licences awarded will provide continued opportunities for our world-class service sector to develop technology and expertise, and ultimately, should provide new energy supplies to the UK.”