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    NSTA fines Repsol, ONE-Dyas for North Sea transgressions

    Nov. 27, 2024
    Britain’s North Sea Transition Authority has fined Repsol North Sea for conduct that led to a shut-in at the Flyndre field.
    Courtesy Repsol Resources UK
    NSTA fines Repsol, ONE-Dyas for North Sea transgressions

    Britain’s North Sea Transition Authority (NSTA) has fined Repsol North Sea (RNS) for conduct that led to a shut-in at the Flyndre field in the central UK North Sea.

    The £350,000 ($420,000) fine was the largest to date imposed by the Authority on a North Sea operator.

    Although RNS’ Fulmar platform ceased production in 2018, it continued to host transportation of oil and gas from the company’s Auk and Clyde fields and also Flyndre. The latter was owned and operated at the time by TotalEnergies, before NEO acquired operatorship in July 2020. 

    Prior to this transaction Repsol had advised TotalEnergies that it planned to increase transportation charges through Fulmar. However, when TotalEnergies questioned the increase, RNS sent a Termination Notice advising the agreement would end. 

    According to the NSTA, Repsol rebuffed TotalEnergies’ request for further talks and provision of information. So the transportation agreement ended on August 6, and due to maintenance at Fulmar at the time, Flyndre remained shut-in until August 13.

    At that point, the parties reached a temporary agreement that allowed transport of oil and gas from Flyndre to resume. But no long-term agreement followed with the situation only resolved when RNS assumed ownership of Flyndre in November.

    The NSTA’s investigation determined that Repsol had not adopted the measures needed to secure the maximum value of economically recoverable petroleum as required by the MER UK Strategy.

    In addition, RNS was found to have exerted undue pressure on TotalEnergies and NEO in the renegotiating agreements which caused Flyndre to be shut-in for five days. And the company imposed an unrealistic timetable, and did not supply timely information or justify the proposed rise in charges.

    It also used the Termination Notice as a pressure tactic to gain a commercial advantage. The repercussions could have had a negative impact on investment in the UK North Sea as a whole, the NSTA added, hence the fine.

    Jane de Lozey, director of Regulation, said: “The NSTA will continue to work with industry to help operators meet the required standards of behavior; and this action shows that we will not hesitate to take action when an operator falls short.”

    Last month, the NSTA issued guidance for the conduct of North Sea transactions calling for greater collaborative working between companies to help minimize transaction delays.

    It has also fined another operator, ONE-Dyas, for P&A of a well on a license, then sending an application for the consent on June 8, 2023, two days after the work had been completed.