A judicial review into the future of the Gryphon floating production storage and offload (FPSO) vessel has concluded.
The UK High Court heard Nobel Upstream’s lawsuit aimed at stopping TotalEnergies’ previously filed decommissioning plan for the FPSO from 3-5 June.
Nobel Upstream argued that the North Sea Transition Authority (NSTA) approval of TotalEnergies’ decommissioning plan does not follow its statutory duty to maximise the economic recovery of oil and gas in the UK Continental Shelf.
TotalEnergies, in line with its decommissioning plan submitted in 2023, shut down Gryphon at the start of the year.
Nobel Upstream argued that stopping production at the FPSO would leave around $300 million of known oil and gas reserves in the ground and cost the UK over £150 million of tax revenues.
And according to the company, the case marks the first time the economic recovery duty has been tested in the courts in this way.
Nobel Upstream chairman and CEO Larry Bates said: “Today marks the end of a costly and unnecessary legal process where we have had to apply to the courts simply to ensure the UK oil and gas regulator applies the law as it was intended. We have engaged broadly and openly to make the case for the regulator to reverse its decision and allow a positive cash flow asset to continue production out to the end of its economic life.
“This case is the thin end of the wedge for the UK oil and gas industry, with oil and gas production from existing assets providing UK energy security and sustaining tens of thousands of well-paid and skilled jobs in communities across the country. The loss of production into the Gryphon FPSO alone also means the Treasury is losing out on £230,000 per day.
“We have submitted an offer to buy the asset to continue production and that offer remains on the table.”
Judicial review
A court decision on the judicial review and the future of the Gryphon FPSO is expected in the coming months.
In addition to producing from the Gryphon field itself, the Gryphon FPSO hosts subsea tiebacks to the Maclure and Tullich fields as well as Ballindaloch in Block 9.
Nobel Upstream holds a 7.6% stake in Maclure, with operator TotalEnergies holding 38.2%, Taqa 37% and Apache 17.2%. Nobel also holds 8% in Ballindalloch, and TotalEnergies holds the 92% operating stake.
According to TotalEnergies’ decommissioning plan, activities should take place from 2025 through to the end of 2026.
Union Unite waded into the dispute this year, saying that the UK government should take action to help restart the FPSO to protect around 200 jobs and support the UK’s energy security.
Nobel Upstream head of commercial Nicholas Pogson added: “Having been involved in oil and gas production on the Gryphon FPSO for over a decade, both at Maersk Oil, the previous operator, and at Nobel, it is the right asset, it just needs to be in the right hands to allow production to continue out to the end of its economic life.
“The FPSO underwent significant upgrades in 2021 on the understanding that production would continue to the end of 2027 at least.”
