Extra 1.1bn barrels of oil found in North Sea

An extra 1.1 billion barrels of oil and gas have been found in the North Sea, a regulator’s report has revealed, threatening to stoke a row over Ed Miliband’s ban on new drilling.

Energy companies have found preliminary evidence to suggest that new areas of the North Sea could yield 15.8 billion barrels of oil and gas, up from earlier estimates of 14.7 billion barrels.

The discovery was revealed in a report published by the North Sea Transition Authority (NSTA), the government regulator.

The surveys were carried out under the last round of licences issued by the NSTA in 2022, before Mr Miliband banned exploration for new oil and gas.

However, the findings are likely to inflame a growing row over the future of the UK oil and gas industry, with Labour having come under fire over its decision to retreat from the North Sea.

Oil and gas developers have claimed Labour is fuelling an exodus of investment and jobs from the North Sea.

The NSTA Reserves and Resources Report sets out the amounts of oil and gas extracted from UK waters over the last 50 years – about 48 billion barrels – and how much might be left.

These remaining resources are categorised according to how confident the NSTA is in the data. They suggest there are 2.9 billion barrels of proven reserves plus another 5.3 billion barrels of “contingent resources”, where the amounts are less certain.

The third and largest category lists “prospective resources” in areas that need more surveys. It is this category that has grown, from 14.7 billion to 15.8 billion barrels, largely because of data gathered under the new licences issued in 2022.

Overall the data show that if all the resources were proven, there could be another 25 billion barrels in place.

In reality, some might never be produced – for example, because it lies in areas that would be too expensive to access.

However, there are also areas around the UK that have never been fully explored, so there could be yet more oil and gas to be found.

The report from the NSTA – which is overseen by Mr Miliband – said the prospective areas showed a 31pc increase in potential oil and gas resources from the end of 2023.

It said: “This is due to the inclusion of the additional prospective resources from the 33rd licencing round.”

Martin Copeland, the chief financial officer at Serica Energy, a North Sea oil and gas producer, said: “This NSTA report shows that there at least 11 billion barrels of oil and gas which could still be developed in the North Sea.

“This almost meets the amount that the Climate Change Committee says we will need before the net zero target year of 2050 of 13 billion to 15 billion barrels.

“So with the right policy changes and tax regime, the UK could effectively be self-sufficient on the oil and gas it will need and would otherwise have to import.”

Daniel Slater, an energy analyst at Zeus Capital, said the findings changed the picture significantly, adding: “The new NSTA report is further evidence of the significant remaining potential in the UK North Sea helping underpin UK economic activity, energy security, jobs and tax revenue.”

Claire Coutinho, the shadow energy secretary, said: “Right now we are paying billions of pounds to Norway for the very same fuel we could be drilling ourselves, that is mad.”

Richard Tice, the Reform energy spokesman, said: “Reform UK is engaging with the UK oil and gas sector as we prepare for Government. An immediate priority for us will be reversing the hugely damaging energy policies of the Labour Government.”

A spokesman for the Department for Energy Security and Net Zero said: “Issuing new licences to explore new fields will not take a penny off bills, cannot make us energy secure, and will only accelerate the worsening climate crisis.”

[Source: Daily Telegraph]