An Area Plan is a cross licence/ cross Hub collaborative framework to maximise economic recovery of oil and gas, whilst supporting the drive to net zero carbon by 2050, in a particular geographical area of the UKCS, based on the analysis of evidence.
The OGA is working closely with operators, licence holders and other interested parties to develop Area Plans across the oil and gas life cycle. These integrate exploration, development, production, and decommissioning to ensure operations maximise economic recovery with the optimum use of infrastructure to extend asset life.
Area Plans, like industry, are evolving, with scopes of work now incorporating energy integration and net zero considerations; all in support of industry meeting the UK Government’s target of net zero by 2050.
Area Plans by Region
Area Plans represent a shared view amongst industry participants of the optimal way to achieve MER UK, whilst supporting the drive to net zero carbon by 2050, in a specific set of circumstances. For the majority of Area Plans, the OGA will normally expect industry to lead on developing and delivering the plans.
The OGA have developed Guidance to aid the industry’s understanding of their responsibilities for developing Area Plans and help improve collaboration across the UKCS. As experience and practice develop, the OGA will update and review this guidance.
Under the leadership of Steve Phimister, Industry Cultural Change Champion, industry have created Behavioural Guidelines to help those involved in Area Plans. These Guidelines provide advice, share insights from existing Area Plans groups and signpost to relevant tools and resources.
Area Plan stage-gate process
The OGA has developed a stage-gate process (diagram above) to help industry develop and track Area Plans. This can be adapted as appropriate to suit individual Area Plans.
It is the responsibility of industry participants involved in producing and implementing an Area Plan to seek their own assurance that their conduct is compliant with competition law and that an appropriate competition impact assessment has been completed prior to among other things sharing information. The OGA set out the context and background to competition law in a competition and collaboration note published in November 2016.
If there is insufficient progress from industry during the work phase of developing an Area Plan, the OGA may intervene to take the lead from industry – i.e. complete the analysis and share findings with relevant Industry parties, and consider whether to produce an OGA Plan based on the Area Plan. An OGA Plan sets out the OGA’s view of how any of the obligations of the Strategy may be met. The OGA is likely to intervene to take the lead when:
- the process to develop an Area Plan is not proceeding as per the agreed Project Execution Plan (PEP) schedule; or
- the OGA considers that the emerging Area Plan is not broadly consistent with the core objectives.
If any licensee believes they should be a legitimate participant of an existing Area Plan please contact the OGA.