OGA opens investigation into possible loss of value as a result of a failure to collaborate
The Oil and Gas Authority (OGA) has opened an investigation into a possible failure to maximise economic recovery for the UK due to a commercial disagreement.
The OGA considers there to be sufficient initial evidence and will now open a sanctions investigation.
The investigation will now, among other things:
- gather and assess further information to enable the OGA to reach a decision
- offer the companies concerned the opportunity to provide written representations
- decide how the case should be resolved
A June 2019 OGA letter to licensees and infrastructure owners outlined the OGA’s regulatory approach. While praising a great deal of constructive engagement, the letter noted that: “Despite good progress we still see too many issues taking too long to resolve or ending up in deadlock between disputing parties, threatening MER UK.”
Notes to editors:
- This case concerns the recovery of hydrocarbons. The suspected failure took place at a time when the OGA was following the MER Strategy.
- The MER Strategy has been succeeded by the current OGA Strategy.Industry collaboration is key to maximising economic recovery and assisting the Secretary of State to meet net zero targets.
- The investigation has been launched under the OGA’s Sanction Procedure
- The OGA has the duty to regulate the industry and has communicated to industry the strategic significance the OGA places on regulatory compliance to support industry’s “social licence to operate”.
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