Water operators across the North Sea, Irish Sea and Atlantic Sea have produced 47 billion barrels over 50 years. Photo: Martin Langer/Alamy Stock Photo
The UK must begin a drilling race to extract the billions of barrels of oil and gas that remain offshore, says the chief executive of the North Sea Transition Authority (NSTA).
Stuart Payne is clearing the way for producers to develop the oil and gas still beneath the UK's continental shelf, which he says will help support the country's energy security for decades to come.
Over the next few weeks, his organisation, is expected to issue up to 88 new oil and gas licenses, up from the 27 issued in October.
The move is likely to anger environmentalists fighting to stop new drilling, but will please many in the energy industry.
“I’m a shameless optimist when it comes to the North Sea,” says Payne. “Frankly, there is a race to extract oil and gas from an economic and infrastructure perspective.
“Oil and gas have clearly been the dominant part of the North Sea resources. History for the last 50-60 years. And that will be a significant part of its next 25 to 40 years.”
Over the past five decades, British offshore operators have produced 47 billion barrels of oil in the North Sea, Irish Sea and Atlantic Ocean.
However, Payne said 15 billion barrels of oil and gas remain in unexplored areas. the oceans surrounding the UK, plus a further nine billion already explored or drilled.
Stuart Payne is clearing the way for producers to exploit more oil and gas in the UK. Photo: Jeff Gilbert
Payne's comments come as Parliament prepares for the second reading on Monday of the Offshore Oil Licensing Bill, which would require the NSTA to hold oil and gas licensing rounds every year rather than irregularly as it currently does.
Energy Minister Claire Coutinho announced this. argued that the domestic oil and gas industry was vital to the UK's energy security and economy, so speeding up the issuance of exploration licenses would boost investor confidence and make the UK more energy independent.
The fact that Payne shares this view will prove controversial given that the Labor Party, the Liberal Democrats and the Scottish National Party have vowed to stop new drilling.
Many banks have also said they will not lend money for new oil and gas fields. projects, whereas just a few weeks ago the UK signed the Cop28 pledge to “transition” away from fossil fuels.
However, Payne believes there is no contradiction between approving new oil and gas developments and working towards net zero.< /p>
He says that while the UK's oil and gas sector may be in long-term decline, it will remain important in the coming years – both for energy security and for the development of low-carbon energy sources such as mass hydrogen production and CO2 capture and storage. and sea wind.
“I’m excited that the North Sea is the crown jewel of the UK’s energy systems,” he says. “Oil and gas will become part of a balanced diet. It will be part of an increasingly mixed energy system.
“Some of the oil and gas projects we approved this year will continue to produce into the 2050s. It's a long way from turning off the [North Sea] lights. We are talking about the fact that the offshore industry will change and develop.
“Places like the North Sea will be awash with new technologies such as CO2 capture and storage, hydrogen production, offshore wind, etc. potentially tidal and wave energy plus gas storage.”
Payne's key point is that such low-carbon technologies are not an alternative to oil and gas, but are part of the same maritime industry. The supply chains, workers, their skills and investors that once built the oil and gas industry will be largely the same ones behind these new technologies.
This vision also includes drilling platforms and hundreds of miles of pipe , stretching along the seabed, as well as all the other infrastructure needed to extract oil and gas.
Many of these structures, in his opinion, will one day become the driving force behind the low-carbon industries of the future.
Many of these structures, he believes, will one day become the driving force behind the low-carbon industries of the future.
p>
Pipes that once brought gas to shore to heat homes will instead carry hydrogen generated by offshore turbines. Others may take waste CO2 from gas-fired onshore power plants or cement factories offshore and inject it into rocks deep under the sea for permanent storage.
“We have invested a huge fortune, both in terms of money, people and carbon emissions, to create this amazing network,” he says. “It's not just about oil and gas, we need to be able to put money aside for the next generation of energy technologies.
“Some people will say the energy transition will be the death of oil and gas. gas industry, but this sector must find its place in this transition process. And this is really possible.
“We need to make sure we extract the necessary equipment, capabilities and capital from this sector. If we want to achieve carbon capture, it won't come from the chocolate industry. It will come at the expense of oil and gas.”
Environmentalists might argue that such views are exactly what one would expect from a lifelong oil executive whose career began at energy giant Shell.
He subsequently spent time in Aberdeen with the Korean company Dana Petroleum, a major North Sea company. operator and then moved to NSTA as Director of Human Resources in 2015.
By 2020, he had added supply chain and decommissioning to his assignment and effectively oversaw much of NSTA's work.
p> >When Andy Samuel stepped down as CEO in 2022, Payne became the obvious successor.
However, Payne's rise to the status of the UK's top offshore energy regulator has coincided with a huge shift in attitudes towards oil and gas.
As coal mining virtually disappears Since then, these fossil fuels have become a new target for environmental movements.
This makes Payne's plan to issue new oil and gas licenses highly political – especially in the run-up to the general election.
Is he prepared for the coming storm? Payne hopes to turn the energy debate into a measured conversation that takes into account the fact that the UK still gets three quarters of its energy from oil and gas.
Gas, he notes, provides 40% of the country's electricity and heats 25 million homes. Likewise, around 32 million cars still use petrol or diesel.
“Much of the debate around the energy transition has not benefited us,” he says. “Yelling at each other on both sides of an argument is a pretty unattractive approach. I think it's always very important where people have the real conversations.
“We live in a world where 75 percent of our energy comes from oil and gas, so where do we want it produced? Do we want as many of them as possible produced in a place where we can control safety, human rights and emissions? And where can we create hundreds of thousands of well-paying, high-skill jobs? Or do we as a society not care about this anymore?”
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