UK to encourage oil production west of Shetland
The 22nd offshore licensing round was launched by Stephen Timms, UK energy minister, and included a new frontier
licence to encourage activity to the west of Shetland. Timms said the round was the most extensive since 1965 and
proof of the government's commitment to region.
"The new frontier licence is just the latest move in our drive to maximise the potential of the natural resources along the UK continental shelf. Coupled with the other regions open for offer, I am sure the offshore round will be a clear success."
Under the frontier licence, as with the already successful promote licence, the rental fee will be cut by 90 % for
the first two years compared to the rate for a traditional production licence. This, together with the extended
exploration and development periods will give companies an added incentive to find oil and gas in the region.
The frontier licence is only available in the west of Shetland region.
The promote licence offers the licensee the opportunity to assess and promote the potential of the licensed acreage
for an initial two-year period without the stringent entry checks required as part of a traditional licence.
While in Aberdeen, Timms announced that a dedicated resource devoted to encouraging development of the nuclear decommissioning supply chain would soon be based at the department of trade and industry office in the city.