Question

To ask Her Majesty’s Government what pre-application due diligence checks are made on companies which apply for petroleum exploration licences, or are associated with such applications, before those applications are accepted or granted; what checks are made on the previous records of the companies in the UK and other countries as part of such due diligence; and what criteria are applied in decisions about whether a company is accepted as suitable to bid for such licences.

In the most recent (14th) Landward Licensing Round all applicants were required to demonstrate their financial viability and the financial capacity to carry out their respective proposed Work Programmes, and that they met residence requirements. The proposed operator in each case was also required to demonstrate the organisational capability and technical and environmental competence to operate to the necessary standards. Consideration was also given to each proposed operator’s past record (in the UK and elsewhere) of compliance with environmental legislative standards or requirements, any criminal or civil action taken against them for environmental reasons, convictions for breaches of environmental legislation and pending criminal or civil action for environmental breaches. Detailed guidance explaining requirements for applicants can be found at: https://www.gov.uk/guidance/oil-and-gas-licensing-rounds

In the 14th Round, applications were invited on 28 July 2014, to be submitted by 28 October 2014. 95 applications from 71 companies were received. The Oil and Gas Authority has now offered 92 new licences and the extension of one existing licence to groups that included 43 companies. Of the companies to whom no offer was made, 12 had failed to satisfy the necessary financial criteria and five proposed operators had failed to demonstrate the necessary level of environmental awareness.