UK energy regulator creates £1 million prize fund to decarbonize offshore oil and gas

A £1million competition has been launched to help decarbonize offshore oil and gas production.

The competition, managed by the Oil and Gas Authority (OGA), is designed to advance the widespread electrification of offshore installations on the UK Continental Shelf (UKCS), which are powered by gas or diesel.

Organizers are looking for studies (technical, engineering, and/or commercial) that will bring electrification projects a step closer to reality.

The winning ideas will be allocated a share of the £1m prize fund, to complete the proposed work by 31st March 2022.

Power generation accounts for around two thirds of oil and gas production emissions. It is anticipated that powering installations using electricity either from a cable to the shore or from a nearby windfarm, could lead to 2-3Mtpa CO2 emissions reductions, which is equivalent to the annual carbon emissions from households in a city the size of Liverpool.

In addition, the resulting power demand from offshore oil and gas electrification could potentially support up to 4 gigawatts of new offshore wind power capacity.

OGA Chief Executive Dr Andy Samuel said: “Electrification of oil and gas installations is a vital part of industry’s license to operate and to meet its North Sea Transition Deal emissions reduction targets. This is also a big opportunity for industry to support offshore wind expansion, with lasting infrastructure that will provide benefits beyond oil and gas, long into the future.”

This competition follows the government’s commitment in the North Sea Transition Deal to support funding for early-stage offshore electrification studies by end 2021. Key results from the studies will be published for others to benefit from and build on the ideas generated.

Energy & Climate Change Minister Greg Hands said: “Through our landmark North Sea Transition Deal, we are supporting the UK’s oil and gas industry in the transition to a lower carbon future. This £1 million investment for electrification projects demonstrates how we are delivering on these commitments, enabling the industry to develop the infrastructure it needs to decarbonize North Sea production.

“Not only will this help the oil and gas sector to reduce their emissions, this can also support new offshore wind capacity to help grow the UK’s offshore wind sector, supporting the shift to green technology and renewable energy in the UK.”

The OGA has been actively progressing electrification opportunities in areas including the Central North Sea and West of Shetland: bringing operators together; hosting workshops with the power sector; and pressing operators for more pace on project delivery.

Platform electrification is a key component of the OGA’s vision for an integrated energy basin. The OGA’s Energy Integration Report found that the UK Continental Shelf could (through a mix of platform electrification, carbon capture and storage, offshore wind and hydrogen) absorb up to 60% of the UK’s entire CO2 abatement needed to achieve net zero emissions by 2050.

Collaboration opportunities between the oil and gas and windpower sectors are increasingly being recognized by industry and government, as in the recent launch of the INTOG (Innovation and Targeted Oil and Gas decarbonization) consultation by the Scottish Government).