Britain's Department of Energy has revealed terms for a frontier exploration licensing round that include a seismic option for the first time.
The round will cover 117 western Atlantic blocks in 11 licenses. It will be the first time frontier acreage has been allocated in a special round.
Terms include longer periods before first relinquishment, which is determined by drilling activity.
The frontier round will run parallel with the 12th licensing round covering 120 blocks in mature areas of the U.K. continental shelf.
Deadline for license applications in the frontier round will be Jan. 15, 1991. Applications for the 12th licensing round are to be submitted by Dec. 12, 1990.
FRONTIER TERMS
License terms for frontier blocks will be more flexible than for 12th round permits.
They will run for an initial 9 years instead of 6 in mature areas.
The second term can be extended beyond 15 years for another 24 years. In mature areas licenses can be extended only beyond 12 years for 18 years.
Rental of frontier blocks will also be cheaper at 60 ($103)/sq km, compared with 350 ($605) for 12th round licenses. The scale of subsequent annual payments is also greatly reduced.
Frontier work programs in the initial 3 years require only a seismic program. Drilling proposals can be included but are not essential. DOE also has the discretion to extend the seismic survey period to 4 years.
Licenses can be dropped at the end of this initial period.
No work program will be required for the remaining 4 or 5 years, but companies retaining acreage will be expected to drill at least one well in the remaining years of this part of the license.
The number of wells drilled in the first term will determine the level of first relinquishments.
On licenses where one well was drilled, one fourth of the acreage can be retained. Two wells will secure half the acreage, and companies drilling three or more wells will retain the entire license.
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