United Kingdom Government notice concerning European Parliament and Council Directive 94/22/EEC of 30 May 1994 on the conditions for granting and using authorisations for the prospection, exploration and production of hydrocarbons

(2004/C 56/02)

(Text with EEA relevance)

ANNOUNCEMENT OF UNITED KINGDOM ONSHORE AND OFFSHORE OIL AND GAS LICENSING ROUND

DEPARTMENT OF TRADE AND INDUSTRY

THE PETROLEUM (PRODUCTION) (SEAWARD AREAS) REGULATIONS 1988

OFFSHORE (SEAWARD)

1. The Secretary of State for Trade and Industry invites interested persons, in accordance with the Petroleum (Production) (Seaward Areas) Regulations 1988 (S.I. 1988 No 1213), as amended ("the 1988 Regulations"), and the Hydrocarbons Licensing Directive Regulations 1995 (S.I. 1995 No. 1434), to apply for Seaward Production Licences (referred to below as "Traditional Licences"), Promote Seaward Production Licences (referred to below as "Promote Licences"), and Frontier Seaward Production Licences (referred to below as "Frontier Licences"). In particular the Secretary of State invites applications for "Frontier" and "Traditional" Production Licences in the areas marked SEA 1 and SEA 4, and applications for "Traditional" and "Promote" Seaward Production Licences in the areas marked SEA 2 and SEA 3. Details of these Licence types are available on the website at: www.og.dti.gov.uk

2. This invitation is in respect of those blocks and parts of blocks that are not subject to an existing petroleum production licence on the date of this notice in the areas shown on maps deposited at the Department of Trade and Industry Library, where they can be viewed by prior appointment (see below for contact details) between 9.15 and 16.45, Monday to Friday, until 2 June 2004. The maps and a list of the blocks and part blocks comprising this offer are also available on the DTI's Oil and Gas website (www.og.dti.gov.uk). This is the United Kingdom Continental Shelf (UKCS) 22nd Round of Licensing.

3. Licences issued pursuant to this invitation will incorporate clauses based substantially on the Model Clauses set out in Schedules 2 and 3 of The Petroleum Licensing (Exploration and Production) (Seaward and Landward) Regulations 2004.

4. A Strategic Environmental Assessment (SEA) of the area marked as SEA 4 has been conducted and the findings of the assessment can be found at the website below, (SEA's for the areas SEA 1-SEA 3 can be found at the same site):

http://www.offshore-sea.org.uk/sea/ index.php

APPLICATIONS FOR LICENCES

5. Applications must be made on the Application Form for Seaward Production Licences, which is available on the DTI's Oil and Gas website or from the Licensing and Consents Unit Licence Administration (see below for contact details). An application must be either for Frontier, Promote, or Traditional Licences; they may not be mixed. While an applicant may apply for different types of Licence over different pieces of acreage, no applicant may apply for different types of Licence over the same acreage. All applications, Traditional, Promote, and Frontier, must be delivered to the Department of Trade and Industry at 1 Victoria Street, London SW1H 0ET, together with a fee of GBP 2820 per application. The Department of Trade and Industry will set up a desk to receive Traditional, Frontier and Landward Applications between 9.30 and 13.00 hrs on the 3 June 2004. For "Promote" Licence applications the desk will be set up between 9.30 and 13.00 hrs on the 4 June 2004, although earlier submissions would be accepted. No application will be accepted after 13.00 hrs on the last day.

6. All applications will be judged against the background of the continuing need for expeditious, thorough, efficient and safe exploration to identify oil and gas resources of the United Kingdom Continental Shelf, with due regard to environmental considerations.

7. When applying for more than one block, applicants should indicate an order of preference. There will be no restriction on the number of blocks that may be applied for, but there will be a maximum contiguous area for each Licence, and a maximum on the overall acreage awarded to a particular Applicant Group. The DTI may also limit the award in terms of numbers of blocks in a contiguous area or in terms of the spread of awards where it is in the interests of maximising recovery on the UKCS.

8. Further guidance on the material with which applicants may support their applications is given in "Notes for Applicants", available from the Licence Administration Group and on the DTI's Oil and Gas website (see below for contact details).

Traditional Applications

9. Applications will be judged on the basis of the following criteria:

(a) the financial capability of the applicant to carry out the agreed Initial Term Work Programme (within four years);

(b) the technical capability of the applicant to carry out the agreed Initial Term Work Programme, and as appropriate any other activities permitted under the Licence (taking into account the quality of geotechnical analysis and degree of innovation);

(c) any lack of activity, efficiency or responsibility displayed by the applicant under any other licence of any description issued under the Petroleum Act 1998 or previous legislation having similar effect.

10. The proposed operator within each applicant group (including any company that is the sole applicant) must submit a statement of its general environmental policy for the conduct of licensed activities in seaward areas.

Frontier Applications

11. Applications will be judged on the basis of the following criteria:

(a) the financial capability of the applicant to carry out the agreed Work Programme before the end of the Second Term (within six years);

(b) the technical capability of the applicant to carry out the agreed Initial Term Work Programme, and as appropriate any other activities permitted under the Licence (taking into account the quality of geotechnical analysis and degree of innovation);

(c) any lack of activity, efficiency or responsibility displayed by the applicant under any other licence of any description issued under the Petroleum Act 1998 or previous legislation having similar effect.

12. The proposed operator within each applicant group (including any company that is the sole applicant) must submit a statement of its general environmental policy for the conduct of licensed activities in seaward areas.

Promote Applications

13. Applications will be judged on the basis of the following criteria:

(a) the technical and innovative capability of the applicant to carry out the agreed Work Programme to establish a viable drilling prospect during the first two years of the licence and, where relevant, any other activities permitted under the Licence;

(b) the quality of the applicant's approach to securing the additional financial and technical resources that would be needed to complete the substantive work programme contemplated in the second two years of the Initial Term;

(c) any lack of activity, efficiency or responsibility displayed by the applicant under any other licence of any description issued under the Petroleum Act 1998 or previous legislation having similar effect.

14. Promote Licences will expire after two years if the Licensee has not satisfied DTI of its technical and financial capacity to complete the Initial Term Work Programme which will include a firm commitment at that time to the drilling of at least one well, or to conduct an equivalent agreed substantive activity. The Initial Term Work Programme must be carried out within four years.

15. Following consideration of all applications, the Secretary of State will notify all applicants in writing of his decisions. In all cases where the Secretary of State is prepared to award a licence, DTI will prepare a draft licence and send it to the successful applicant, who will then have the option of accepting it by returning it to DTI signed by all members of the applicant group. An unsuccessful applicant will be notified of the reasons for the Secretary of State's decision if he submits a written request for this information to be provided.

16. The Government accepts no liability for any costs incurred by the applicant in considering or making its application.

LICENCE RENTAL PAYMENTS

17. Any licence granted as a result of this invitation will be subject to payment of consideration according to provisions set out in the Model Clauses and in Schedules to the Licence, in summary:

Traditional Licences

(a) four annual payments, beginning at the commencement of the Licence, of GBP 150 for each square kilometre that it covers at the anniversary of its coming into force;

(b) subsequent annual payments of GBP 300 for each square kilometre covered, rising by annual increments of GBP 900 to a maximum of GBP 7500 per square kilometre (this payment is subject to biennial review in line with movements in the Index of the Price of Crude Oil acquired by Refineries, published in the Digest of United Kingdom Energy Statistics); and

Promote Licences

(c) as for traditional applications, except that payments will be reduced by 90 % for the first two years of the licence only;

Frontier Licences

(d) six annual payments, beginning at the commencement of the Licence, of GBP 50 for each square kilometre that it covers at the anniversary of its coming into force; except that payments will be reduced by 90 % for the first two years of the licence only;

(e) subsequent annual payments (see above) as those stated for the traditional rates.

ONSHORE (LANDWARD)

THE PETROLEUM (PRODUCTION) (LANDWARD AREAS) REGULATIONS 1995

18. The Secretary of State for Trade and Industry invites interested persons, in accordance with the Petroleum (Production) (Landward Areas) Regulations 1995 (S.I. 1995 No 1436) and the Hydrocarbons Licensing Directive Regulations 1995 (S.I. 1995 No 1434), to apply for Petroleum Exploration and Development Licences in respect of those onshore areas above the Medium High Water Line (although the area below the Medium High Water line within the Solent Bay closing lines and marked on the maps detailed below will form part of this offer although no surface drilling will be possible under any Licence issued for this area) that are not subject to an existing petroleum production licence or current out of round offer on the date of this notice shown in areas on maps deposited at the Library at the Department of Trade and Industry, 1 Victoria Street, London, SW1H 0ET. These maps may be inspected by prior appointment (tel. (44-207) 215 50 06, fax (44-207) 215 56 65) between 9.15 a.m. and 4.45 p.m. Monday to Friday until 2 June 2004. The maps are also available on the DTI's oil and gas website, (http://www.og.dti.gov.uk). This is the 12th Round of Landward Licensing.

19. In line with the condition stipulated above United Kingdom Ordnance Survey Blocks NS 88, 89, 97, 98, 99 are currently the subject of an Out of Round offer and therefore do not comprise part of this 12th Round of Landward Licensing offer.

Application for licences

20. In respect of all blocks referred to in paragraph 18:

(a) applications should be made on a standard application form available from the Department of Trade and Industry; copies of the application form and all other documents referred to in the text of this notice as being available from the Department of Trade and Industry may be obtained from the Licensing, Exploration and Development Branch, Licensing and Consents Unit, Department of Trade and Industry, 1 Victoria Street, London, SW1H 0ET (tel. (44-207) 215 51 11 or (44-207) 215 50 32, fax (44-207) 215 51 42). This documentation is also available on the DTI's oil and gas website (http://www.og.dti.gov.uk);

(b) applications should be delivered to the Licensing and Consents Unit of the Department of Trade and Industry at 1 Victoria Street, London, SW1H 0ET between 9.30 and 13.00 hrs on 3 June 2004 together with a fee of GBP 1000 per application. No applications will be accepted after 13.00 hrs on 3 June 2004;

(c) applicants are requested to indicate where possible any preferences they have as between the blocks they have applied for, and should indicate if any of the blocks applied for are alternatives;

(d) applicants are required to provide details of the work programme for the initial term which they intend to carry out if awarded a licence;

(e) further guidance on the material with which applicants may support their applications is given in notes for applicants, available from the Department of Trade and Industry or from the DTI's oil and gas website (http://www.og.dti.gov.uk).

21. Applications will be judged against the background of the continuing need for expeditious, thorough, efficient and safe exploration to identify oil and gas resources within the mainland of Great Britain. Applications will be judged on the basis of the following criteria:

(a) the financial capability of the applicant to carry out the activities that would be permitted under the licence during the initial term including the work programme submitted for evaluating the full potential of the area within the block or blocks applied for;

(b) the technical capability of the applicant to carry out activities that would be permitted under the licence during the initial term including the identification of hydrocarbon prospects within the block or blocks applied for. The technical capabilities will be assessed in part upon the quality of geological analysis related to the block or blocks applied for, (including taking into account whether the technical work already done or proposed is innovative);

(c) the way in which the applicant proposes to carry out the activities that would be permitted under the licence including the quality of the work programme submitted for evaluating the full potential of the area applied for;

(d) where the applicant holds or has held a licence granted under or treated as having been granted under the Petroleum Act 1998, any lack of efficiency and responsibility displayed by the applicant in operations under that licence.

22. Following consideration of all applications, the Secretary of State will notify all applicants in writing of her decisions. In all cases where the Secretary of State is prepared to award a licence, DTI will prepare a draft licence and send it to the successful applicant, who will then have the option of accepting it by returning it to DTI signed by all members of the applicant group. An unsuccessful applicant will be notified of the reasons for the Secretary of State's decision if he submits a written request for this information to be provided.

23. The Government accepts no liability for any costs incurred by the applicant in considering or making its application.

Licence term and consideration payable

24. Licences issued in respect of the blocks referred to in paragraph 18 will incorporate clauses based on the Model Clauses set out in Schedule 4 to the Petroleum Licensing (Exploration and Production) (Seaward and Landward Areas) Regulations 2004. Licences will have an initial term of six years and a second term of five years. A licence may be extended after the expiry of the second term for a further period of twenty years.

25. The consideration required in respect of petroleum exploration and development licences granted as a result of this invitation will be:

(a) an initial payment, at the time the offer of a licence is accepted, of GBP 25 for each square kilometre comprised in the licensed area;

(b) on the first, second, third, fourth and fifth anniversaries of the date of commencement of the licence term, the sum of GBP 25 will be payable for each square kilometre in the area to which the licence then relates;

(c) on the sixth and subsequent anniversaries of the date of commencement of the licence term, payments calculated by reference to the number of square kilometres in the area to which the licence then relates and subject to biennial review in line with movements in the Index of the Price of Crude Oil Acquired by Refineries (published in the Digest of United Kingdom Energy Statistics) if the Secretary of State so determines. Further details concerning the payments due are available from the Department of Trade and Industry.

General confidentiality

26. Material supplied in support of applications will be treated in accordance with the Code of Practice on Access to Government Information.

Exceptions

27. The terms, provisions, payments and other details relating to each licence will normally be as set out above, but the Secretary of State reserves the right to amend them in some cases to fit particular circumstances (e.g. licences that cover decommissioned fields).

Application dates

28. Seaward Production Licences ("Traditional Licences"), Frontier Seaward Production Licences ("Frontier Licences"), Landward Petroleum Exploration and Development Licences. Between 9.30 a.m. and 13.00 on 3 June 2004.

29. Promotional Seaward Production Licences ("Promote Licences"). Between 9.30 a.m. and 13.00 on 4 June 2004.

Contact details

Licence Administration: Licensing, Exploration and Development Branch, Department of Trade and Industry, 1 Victoria Street, London SW1H 0ET (tel. (44-207) 215 51 11, fax (44-207) 215 50 70).

Department of Trade and Industry Library: 1 Victoria Street, London SW1H 0ET (tel. (44-207) 215 50 06/7, fax (44-207) 215 56 65).

Licensing and Consents Unit website: www.og.dti.gov.uk