Licence assignments and relinquishments

Licence Assignments and Relinquishments

A company that is party to a licence may wish to sell its interest, or a part of it, to another company. It requires the OGA’s prior consent to do so.

If the licensees request to relinquish the acreage on the licence, before agreeing to this the OGA will verify that all wells within the licensed area have been plugged and abandoned.

Here is a downloadable copy of the OGA Guidance on the Onshore Regulatory Regime. This guidance, which consolidates previously available guidance, sets out how the OGA will normally consider stated matters and is not a substitute for any regulation or law and is not legal advice.  

  • Licence assignments

    A company that is party to a licence may wish to sell its interest, or a part of it, to another company. It requires the OGA’s prior consent to do so.

    Any transaction in which one or more companies enters a licence, or one or more companies withdraws from it, is referred to in this guidance as a licence assignment.

    The OGA will consider any assignment made without prior consent as a very serious breach of the licence, and as grounds for immediate revocation of the licence or to reverse the assignment using powers granted in the Energy Act 2008. This applies equally to assignments between unaffiliated companies, to assignments between sister companies within a single company group, and to the withdrawal of a company from a licence.

    Onshore licence assignment applications should be submitted using the Licence assignment application form and completed forms should be submitted by email to approvals@ogauthority.co.uk.

    If there are no reasons to withhold it, the OGA will consent to the assignment for execution by the applicant. We require notification of execution (in the form of an Execution Deed) so that accurate records can be maintained. The OGA will not consider an assignment to be effective until it is satisfied with the validity of the documentation.

  • Licence relinquishments

    If the licensees request to relinquish the acreage on the licence, before agreeing to this the OGA will verify that all wells within the licensed area have been plugged and abandoned.

    There are two ways in which a licensee can give up acreage on a licence:

    • A ‘surrender’ of part of the licensed area while the licence continues over the remaining area
    • A ‘determination’ of the entire licence.The surrender of acreage from a licence does not remove any company from a licence, even a company that is left with no beneficial interest under a JOA. The withdrawal of such a company must be implemented separately by an assignment.

    A Relinquishment Report is required for any significant area surrendered or determination of the entire licence (see further details on Relinquishment Reporting guidelines)

    An operator may submit a licence relinquishment application at any time to surrender or determine acreage. This can be done by submitting a licence surrender or determination application using a licence determination form for each licence. Completed forms should be submitted to licence.relinquishments@ogauthority.co.uk