Exercise of the OGA's powers
To aid in the delivery of its objectives, the OGA has a range powers as set out in model clauses, under third party access to infrastructure (‘TPA’) rules, and under the Energy Act 2016 (e.g. relating to meetings, information and samples, dispute resolution and sanctions).
The OGA’s Powers
The powers, in particular those relating to TPA, dispute resolution and sanctions, are collectively known as the “OGA Powers”. Further details on the range of powers can be viewed here.
The OGA’s escalation process describes the steps the OGA will usually take leading up to a decision whether or not to exercise its powers, and the process is illustrated in the figure below.
The OGA maintains and monitors emerging issues that, if not resolved, could have a negative impact on the value of economically recoverable reserves from the UKCS.
Where it appears that there is a real risk of the parties not resolving an issue independently, and it is considered that one of the OGA powers could encourage resolution, that issue will be added to the OGA’s “Case Register”. The Case Register tracks the progress of that issue through the escalation process outlined above, or until the issue is resolved.
When considering whether or not to take action using the formal powers, the OGA will review that issue alongside the other matters before it at that time and take its view. At a high level, this prioritisation process is based on an assessment of the impact and strategic significance of a particular case, the likelihood of achieving a successful outcome, and the time and costs likely to be incurred by the OGA in pursuing that issue.
Cases on the Case Register that the OGA considers to have been resolved, at least in part, through the intervention of the OGA are added to the OGA’s overall ‘“Success Tracker”, which records all the successes from across the OGA’s engagement with industry.
The figure below records the analyses of cases resolved by such escalation and, separately, cases currently open on the Case Register
As background, the cases referenced above are currently divided into six categories and are measured against the four levels of measured escalation. The historic cases addressed with TPA Infrastructure Access powers can be found on the OGA website here.
It is intended that the data will be updated on a quarterly basis.
“Area Solution”: This category refers to issues where the OGA is working closely with operators, licence holders and other interested parties to develop Area Plans that integrate exploration, development, production, late-life planning and decommissioning to ensure the optimum use of infrastructure, extend the life of hubs, and maximise economic recovery.
“Access to Infrastructure”: This category refers to the third party access process that allows a new field to ask the OGA to set terms for access to processing facilities on existing infrastructure that is owned by other companies.
“Inter JV”: this category refers to issues or disputes that arise between separate joint venture partnerships.
“Intra JV”: this category refers to issues of disputes between the companies within the same joint venture partnership.
“Licence Commitment”: this category refers to the obligations on companies to complete the firm work programmes that they committed to undertake when they bid for the award of a production licence.
“Asset Transfer”: this category is used for cases where there is an issue with the transfer of ownership from one company to another.