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Energy: Oil and Gas Licences

Volume 717: debated on Thursday 4 February 2010

Statement

I am pleased to inform the House that on 26 January 2010 we invited applications for petroleum licences for unlicensed seaward blocks which will form the 26th round of offshore petroleum licensing. These blocks are widely distributed on the UK Continental Shelf and fall within the areas covered by the Strategic Environmental Assessment (SEA) areas 1-8. (A map of the SEA areas can be found at www.offshore-sea.orq.uk.) A copy will also be placed in the Libraries of the House.

DECC’s draft plan to offer licences for offshore oil and gas exploration and production through a 26th licensing round was the subject of a Strategic Environmental Assessment (SEA) completed in 2009. The SEA is documented on a dedicated website (www.offshore-sea.orq.uk) and includes commissioned reports on various components of the natural environment, cultural features and socio-economic considerations. In addition, as part of the SEA, new information was collected, in particular on selected seabed features through seafloor mapping, sampling and photography, on the offshore distribution of large cetaceans, and on important navigation routes and commercial fishing areas. The draft plan for the 26th licensing round included offering blocks to the south-west of England and Wales, and also in those areas that had been subject to earlier DECC SEAs (SEAs 1, 2, 3, 4, 5, 6 and 7), which covered the remainder of the UK Continental Shelf.

The potential implications of the exploration and production activities which could follow if the draft plan was adopted were considered at an expert assessment workshop and a series of stakeholder workshops. The results of these workshops were assessed further and documented in an environmental report, which then formed the basis for consultation with the consultation bodies and the public. The three-month consultation period on DECC’s draft plan and the environmental report was advertised in a number of local and national newspapers and notified by e-mail to a wide range of individuals and organisations.

All responses received from statutory and other consultees on the draft plan and the environmental report have been considered by DECC and a post-consultation report for the Offshore Energy SEA prepared and placed on the SEA website. This summarises consultee comments and DECC responses to them. The full texts of consultee comments have also been placed on the SEA website.

In deciding to proceed with a 26th offshore licensing round, DECC has had regard to the conclusions and recommendations of the environmental report, together with feedback received from consultees. As a result of the SEA process, blocks in the deepest waters of the SW Approaches are being withheld from licensing for the present because of inadequacy of data.

A number of blocks excluded on the basis of recommendations of previous SEAs or currently in the process of appropriate assessment consultation have likewise been excluded from the offer. The environmental report recommended that the blocks in or overlapping with the boundaries of the Moray Firth and Cardigan Bay SACs should also be withheld from licensing for the present, while the further assessments initiated following the 24th licensing round applications are concluded. We have therefore excluded 11 blocks in the Cardigan Bay area and 10 in the Moray Firth. In addition, 228 blocks will not be offered for licensing in the areas covered by SEAs 1-8, at the request of the Ministry of Defence. Licensing of the blocks excluded from the round may be revisited in the future—for example, as more information on the features of interest becomes available.

In addition, a number of blocks may be licensed, but with conditions attached restricting or prohibiting certain marine activities. It should be noted that the Offshore Petroleum Production and Pipe-lines (Assessment of Environmental Effects) Regulations 1999 and the Offshore Petroleum Activities (Conservation of Habitats) Regulations 2001 variously require that all major activities undertaken in connection with UK offshore hydrocarbon exploration and production should be subject to environmental assessment before consent is given for these activities.

Before any licence awards are made, DECC will assess whether the grant of licences applied for in the 26th round is likely to have a significant effect on the management of any protected conservation sites. Where such effects cannot be excluded, a further detailed assessment will be needed to determine whether there are any adverse effects on the integrity of these protected conservation sites. This is required under Council Directive 92/43/EEC on the conservation of natural habitats and wild fauna and flora, and UK implementing regulations.

DECC has, with industry and statutory environmental advisers, established an offshore oil and gas environmental monitoring committee, which is charged with co- ordinating the strategic monitoring of potentially significant environmental effects of the industry, including those that could arise from the implementation of the plan to hold a 26th round of offshore licensing.