Offshore staff
LONDON — Britain’s North Sea Transition Authority (NSTA) has opened a consultation on new guidance designed to speed up and sell UK offshore assets.
Various concerned operators and licensees are said to have asked the NSTA to intervene, citing delays to operational activities and capital projects; blocked transactions impacting North Sea production; issues with decommissioning cost exposure holding up deals; and excessive partner requirements tying up capital that could be used productively elsewhere in the basin.
The consultation will encourage licensees and investors to share their views on how to strike a balance between market liquidity and preserving investor confidence, the role of self-regulation and future NSTA guidance on license assignments.
Proposals in the draft guidance include:
- Agreeing to a transaction project plan at an early stage, with the resources needed to effectively implement it;
- Preparing a capability pack, created by the buyer and seller to inform partners of the corporate, technical and financial information they need to reach a decision;
- Agreed timelines with milestones;
- Open, constructive negotiations; and
- Proportionate security arrangements to meet decommissioning liabilities.
Jane de Lozey, NSTA director of regulation, said, “Some transactions have been delayed or even jeopardized by buyers and sellers failing to engage joint venture partners early enough, and the new guidance will provide clear actions to take and when to take them to ensure that production is maximized.”
The consultation will stay open until May 23 with the new guidance due to be published later in the year.
03.29.2023
