The North Sea Transition Authority (NSTA) has announced that three operators have been fined a total of $322,201 (GBP 265,000).
The move comes as the NSTA “cracks down on behavior that risks the industry’s drive to cut emissions and bolster the UK’s energy security”, the organization outlined.
EnQuest has been fined $182,378 (GBP 150,000) for flaring an excess 262 tons of gas on the Magnus Field between November 30 and December 1, 2021, “despite knowing that it did not have the necessary consent in place”, the NSTA noted.
Equinor was fined $79,030 (GBP 65,000) for flaring at least 348 tons of CO2 above the amount permitted on the Barnacle Field between June and November 2020 and Spirit Energy was fined $60,792 (GBP 50,000) for exceeding the maximum allowed production volumes from two fields over three years, the NSTA revealed.
The organization said producing too much oil and gas can reduce the overall long-term production from a reservoir, to the detriment of the UK’s security of supply, “so it is vital that when an operator wants to raise production it applies for a new consent so that its new plan can be assessed”. The NSTA also pointed out that operators such as EnQuest and Equinor must follow a clear process to apply for consent to flare or vent gas.
“The NSTA is committed to supporting the UK’s energy security and lowering greenhouse gas emissions, including through the use of our robust consenting procedures, which drive down flaring and venting,” Jane de Lozey, the NSTA’s Director of Regulation, said in an organization statement.
“We are encouraged by recent improvements on emissions and will take action to ensure this vital work is not undermined by companies who fail to meet their obligations,” de Lozey added in the statement.
The NSTA noted that EnQuest, Equinor and Spirit Energy all cooperated fully with the NSTA’s investigations, conducted their own internal reviews and have taken steps to avoid repeats of these breaches.
Rigzone contacted all three companies for comment on the NSTA fines.
“The fine relates to an administrative breach on the cross-border Barnacle field,” an Equinor spokesperson told Rigzone.
“Barnacle is developed with a single well drilled from the Statfjord B platform on the Norwegian side of the median line. Any flaring from the field therefore happens and is accounted for in Norwegian waters,” the spokesperson added.
“In 2020, Equinor became aware that it needed to log flaring allocations in the UK, in addition to Norway. The flaring on Statfjord was within Norwegian permits, but technically, the field was operating outside the UK flaring consent for a period of four months due to the missing logs. Equinor promptly self-reported the error to the NSTA and adjusted reporting protocols in response,” the spokesperson continued.
A spokesperson from EnQuest told Rigzone, “EnQuest can confirm it has been sanctioned by the North Sea Transition Authority for a breach of flaring consent that occurred on the group’s Magnus asset in November 2021”.
“The NSTA recognised that EnQuest made contact promptly and maintained a constructive dialogue over the course of the incident. EnQuest took immediate steps to shut production down on December 1, 2021, until authority to restart by the NSTA was received in writing on December 3, 2021. The regulator also recognised that the group had fully cooperated with the enquiry and investigation that followed. The company also conducted its own internal review to determine the cause of the failure and to prevent any future failure to comply,” the spokesperson added.
“Notwithstanding the above, EnQuest accepts the NSTA’s sanction and will meet its obligations to pay the financial penalty as required by the regulator,” the EnQuest spokesperson continued.
A Spirit Energy spokesperson said, “Spirit Energy is committed to operating in a socially and environmentally responsible way and takes any non-compliance in this regard seriously”.
“After identifying the circumstances which gave rise to this sanction, Spirit reported them to the NSTA and fully co-operated with their investigation. Spirit also conducted its own separate internal review,” the spokesperson added.
“Both investigations have now concluded, with Spirit implementing all resulting recommendations with a view to ensuring its future compliance with production consents,” the spokesperson went on to note.
Last month, the NSTA has revealed that an investigation had been launched into an unnamed oil and gas company “for flaring and venting in the North Sea without consent”.
Back in April, the NSTA announced that it had fined Shell UK Limited $62,347 (GBP 50,000) and served it with a sanction notice for breaching five field production consents. In July last year, the NSTA, then named the Oil and Gas Authority, announced that it had fined BP $62,346 (GBP 50,000) and served it with a sanction notice for breaching a license condition by failing to report the progress and results of two extended well tests.
The NSTA regulates and influence the oil, gas and carbon storage industries and helps drive the North Sea energy transition, according to its website, which adds that the organization holds industry to account on halving upstream emissions by 2030.
To contact the author, email andreas.exarheas@rigzone.com
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