MER UK Strategy
The MER UK Strategy came into force on 18 March 2016; its Central Obligation states that “relevant persons must take the steps necessary to secure that the maximum value of economically recoverable petroleum is recovered from the strata beneath UK waters.”
The Central Obligation is binding on relevant persons and the OGA, and to assist with its effective delivery the Strategy also sets out a number of Supporting Obligations, Required Actions and Behaviours. These expand on how the Central Obligation applies in particular circumstances and specify the actions and behaviours to be adopted by relevant persons when carrying out activities in the UKCS.
The Strategy also contains a number of Safeguards; the Central and Supporting Obligations, Required Actions and Behaviours should be read subject to those safeguards.
The supporting obligations cover:
- asset Stewardship
The Strategy also sets out required actions and behaviours included in the obligations. These cover:
- cost reduction
- actions where relevant parties decide not to ensure maximum economic recovery.
The safeguards set out protections for industry and the OGA and include clarification that:
- No obligation under the Strategy will require a relevant person to breach any legislation, including competition law
- The OGA is bound by its duties under common law, including that it must at all times act reasonably
- The Strategy sets no obligations where a proposed investment or funded activity fails to deliver a satisfactory expected commercial return
- no obligation under the Strategy require any conduct where the benefits to the UK deriving from it are outweighed by the damage to the confidence of investors in UK oil and gas.
The Strategy also enables the OGA to produce plans, which set out its view of how any of the obligations may be met.