UK regulator fines BP $69,000 for North Sea licence breach

The UK Oil and Gas Authority (OGA) has fined energy giant BP £50,000 ($69,000) 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.

Having previously consented to the drilling of two development wells, the OGA granted further consent to conduct extended well tests on two wells in August 2019. For each well, BP was required to provide the OGA with a report every Friday. BP was also required to submit a full report of the results and conclusions within 90 days of the completion of 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.

The OGA said that this lack of information unintentionally created an unregulated environment in which it 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 OGA noted.

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 the future.”

Adis Ajdin

Adis is an experienced news reporter with a background in finance, media and education. He has written across the spectrum of offshore energy and ocean industries for many years and is a member of International Federation of Journalists. Previously he had written for Navingo media group titles including Offshore Energy, Subsea World News and Marine Energy.
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