The discovery of gas and oil on the shores of the North Sea in late 1960s was the beginning of oil and gas development both onshore and offshore (Evans 2006). Onshore oil and gas development is considered to be a cheaper activity, as well as easier, in opposition to offshore. It should be mentioned that the deposits of these resources onshore decrease and it leads to widespread offshore development. The main purpose of this report is to consider the development and planning of an oil and gas field onshore, licensing of the industry and the characteristics of the operating companies and contractors.
The development and planning of an oil and gas field onshore
The Environmental, Health, and Safety (EHS) Guidelines are considered to be the references for technical planning of onshore oil and gas field development. In accordance with these documents, oil and gas field development should be planned within the following guidelines:
- collection of the information about seismic exploration,
- research and production drilling,
- development activities along with production,
- pipelines and other transportation activities,
- support operations,
- decommissioning and
- “other facilities including pump stations, metering stations, pigging stations, compressor stations and storage facilities” (Environmental, Health, and Safety Guidelines for Onshore Oil and Gas Development 2007, p. 1).
Licensing of oil and gas field development onshore
The Petroleum and Submarine Pipe-lines Act 1975 was the first collection of norms and rules devoted to the licensing of the industry. The update version of the model clauses may be considered in another document which regulates the process of gas and oil onshore, The Petroleum (Current Model Clauses) Order (1999). There is a practice of creating “adjacent license groups related to field’s extent” (Harvey 2009, p. 5). The main idea of such groups is the development of friendly relationships between the onshore gas and oil companies located on the same territory onshore. The license should directly correspond to the development plan the company has created. To receive a license, a company should know that “any oil and gas development must have the relevant consent(s) from authorities for both construction and operations” (Harvey 2009, p. 3).
Operating company and contractors
There are many companies which deal with onshore gas and oil field development. It is important to note that the companies and contractors with small funds usually operate onshore as the equipment is cheaper in opposition to offshore field development. Still, even onshore oil and gas field development is rather risky. Thus, if a company of contractor drills a hole and spends $20 million on it, if the hole appears to be “dry”, the company loses $20 million. It should be mentioned that the new and exclusive information costs in the industry. Thus, if one company has some remarkable information, it has some priorities in the field development. The information is considered to be the main reason for initiation of exploration. Operating companies and contractors spend much amount of money to have that information (Oil and Natural Gas Exploration 2004).
Thus, it may be concluded that onshore oil and gas field development is the activity that deserves attention. The planning and licensing of the industry should be completed on the basis of the specific laws and guidelines. There are a lot of different companies and contractors which deal with onshore drilling. It should be noted that oil and gas onshore field development is cheaper in comparison with offshore development, but the deposits of onshore resources are much more less that those located offshore.
Reference List
Environmental, Health, and Safety Guidelines for Onshore Oil and Gas Development, 2007. [Online] International Finance Corporation: World Bank Group. Web.
Evans, et al., 2006. Mineral Planning Factsheet: Onshore Oil and Gas. British Geological Survey: Natural Environment Research Council. Web.
Harvey, T., 2009. Guidance Notes for Onshore Oil and Gas field Development plans. York: Department of Energy and Climate Change.
Oil and Natural Gas Exploration, 2004. Encyclopedia of Energy. Oxford: United Kingdom. Web.
The Petroleum (Current Model Clauses) Order 1999. No. 160. Web.