Offshore Energies Magazine - Issue 55 Spring 2023

Licensing rounds & tax Another area that has seen greater urgency from the government has been oil and gas field exploration and production licensing. "Acreage with proven gas reserves, in shallow water which are near existing infrastructure have been prioritised as priority clusters," he says. "This urgency is mirrored in the obligations placed on the licence holder to act swiftly to appraise the prospect. It also is focusing on allocating blocks to companies who promise to bring forward oil and gas production within agreed timeframes." All the more surprising then that the government should have raised the tax burden by so much. However this seems to have been politically necessary as pressure came from Labour, despite the need for energy. "Education is lacking," he says – which is also the case for the likes of the more active protest groups whose every "event" is facilitated by, or even involves the use of, oil products. "If we were to visit schools and explain the importance of oil and gas in everything we do or rely on, even mobile phones, it would help to raise the overall knowledge of how important hydrocarbons are to our everyday lives," he said. High prices stimulate output In the case of already-producing assets, the dramatic rises in commodity prices have seen some decommissioning work delayed: the production cost per additional barrel of oil equivalent is well below the market and some production has suddenly become economically justified.

requirements on capacity sales, driven by the new focus on energy security within Europe," Mr Brett said. Other continental countries such as Germany are doing the same: looking at all the infrastructure across the energy sector. Most UK storage sites are salt caverns, whose value lies mainly in very short-term trading opportunities, rather than seasonal spreads. Rough had been vital for keeping households and industry supplied during winter, when national demand used to double during winter. The expansion of the UK infrastructure will certainly contribute to this, however, more still needs to be done. "The geo-political situation, and the accompanying huge reduction in gas exports to Europe, also turned the clock back in terms of energy policy."

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