OEUK Exploration Insight Report, supported by Westwood

OEUK has published its Exploration Insight Report 2022 that includes results from a joint study with Westwood Global Energy Group. We were delighted to work with OEUK to support the study around exploration trends, prospectivity of the UKCS and the challenges and opportunities facing the industry.

The study revealed that despite the basin’s maturity, the UKCS still contains significant prospective resources, of which a large proportion is within tie-back range of existing infrastructure. Westwood identified c. 6.1 bnboe risked prospective resources within 30 km of existing infrastructure, of which c. 60% is currently licensed. If the distance is expanded out to 45 km beyond existing infrastructure, then the total prospective resources rise to 8.4 bnboe. The challenge, however, will be to revitalise exploration activity levels to enable infrastructure access in a timely manner and improve reserves replacement, which is currently 10% on a 10-year average. Without additional reserves being discovered and developed, a number of production hubs are forecast to cease production between 2025 and 2030, c. 1,600 wells are due to be decommissioned in the next 10 years and UKCS production could reduce by 75%. The report highlights that exploration in the UK can play a critical role ensuring the UK can meet domestic demand, deliver energy security and become an enabler for the energy transition.

Since the study was conducted, the NSTA launched the 33^rd UKCS Offshore Licensing Round on 7 October 2022. The Round is focused on security of supply and accelerating new production, along with exploration opportunities. Westwood has identified 143 undeveloped discoveries and 895 prospects in the available acreage. The prospectivity of the acreage on offer can be seen in the following maps. Westwood expects interest in the Round to be similar to the 32^nd Licensing Round and applications are expected to be concentrated on prospects and discoveries that are adjacent to current production, as companies seek to maximise value and prolong the life of existing assets.