BP fined £50,000 by OGA for N Sea licence breach

Jane de Lozey of the OGA

The UK’s Oil and Gas Authority (OGA) has fined BP £50,000 and served it with a sanction notice for breaching a licence condition by “failing to report the progress and results of two extended well tests” in the Vorlich field of the North Sea.

The OGA said that having previously consented to the drilling of two development wells, it granted further consent to conduct extended well tests (EWT) on two wells in August 2019.

“Those consents included the need for the licensee to provide regular reports during EWT operations (the reporting requirements),” said the OGA.

“BP was also required to submit a full report of the results and conclusions within 90 days of completion of the EWT operations.

“In November 2020, following an OGA enquiry, BP admitted that it had failed to report as required.

“The company’s own investigation found that internal communications had broken down, there was no guidance in place for managing OGA consents and there was a lack of awareness among engineers of consent requirements.

“This lack of information unintentionally created an unregulated environment in which the OGA was unsighted of BP’s actions.

“This, in turn, could have exposed BP to a potential flare breach, of which the OGA would not have been aware and would have been unable to take prompt regulatory action.

“However, in this case there was no flare breach.

“The reporting requirements, if followed, would have allowed the OGA to track that the EWT proceeded in line with the plan submitted by BP; and helped ensure the clean-up criteria being used did not result in excessive flaring.”

The OGA said further investigation into more companies are underway.

Jane de Lozey, OGA Acting Director of Regulation, said: “We are committed to maintaining a strong regulatory regime to uphold standards and ensure a level playing field for licensees and operators in the UKCS.

“On this occasion BP has fallen short of our expectations but, since becoming aware of the breach, BP has engaged positively with the OGA to investigate the cause of the failure and reaffirmed its commitment to compliance with its regulatory obligations in future.

“We will continue to work with industry to improve compliance, and we are currently considering other matters within the UKCS that may result in further regulatory action.”

About the Author

Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.