North Sea oil and gas reserves surge with major new discovery

The North Sea oil and gas sector stands at a crossroads following the publication of the latest North Sea Transition Authority (NSTA) Reserves and Resources Report. The report reveals that potential reserves in the region have again surged, with preliminary evidence indicating up to 15.8 billion barrels of oil and gas could be recoverable from newly identified areas—an increase from previous estimates of 14.7 billion barrels. This new data could reignite the heated debate over the government’s policy banning new drilling—ordered by Ed Miliband—amidst warnings from industry leaders of an exodus of investment and jobs from the UK continental shelf.

Regulatory surveys conducted under the NSTA’s 2022 licensing round, the last before new exploration was halted, have brought these new resources to light. To date, UK waters have produced about 48 billion barrels of oil and gas over the past half-century. The NSTA report categorises remaining assets: 2.9 billion barrels are deemed proven reserves and 5.3 billion barrels as “contingent resources” where the amounts are less certain. The most substantial portion now falls under “prospective resources”—areas where more exploratory work is needed—which have grown following the latest surveys.

The total potential, if all resources become proven, could be as high as 25 billion barrels. Market analysts note, however, that not all these reserves may be economically or technically feasible to produce. Even so, the report highlights a 31 per cent increase in potential oil and gas resources in the prospective category since the end of 2023, driven by the 33rd licensing round’s additional discoveries.

Industry leaders have not been slow to respond. Martin Copeland, chief financial officer at Serica Energy, described the findings as proof that at least 11 billion barrels could still be developed from the North Sea—almost enough to meet the 13 to 15 billion barrels the UK will require before the net zero target in 2050. This suggests that, with appropriate policy and fiscal changes, Britain could remain self-sufficient in oil and gas without relying on imports.

Energy market experts agree that the results are a significant gamechanger. Daniel Slater, energy analyst at Zeus Capital, emphasised the substantial economic, employment and tax revenue implications of the North Sea’s untapped potential. Opposition politicians have pressed the government on the logic of paying foreign suppliers—such as Norway—while domestic extraction opportunities remain.

The Department for Energy Security and Net Zero maintains that new exploration licences will not reduce energy bills, nor enhance energy security, and would only exacerbate climate concerns. The debate is set to intensify as the industry, policy makers and environmental campaigners scrutinise the future direction of UK energy policy—with billions in potential investment, thousands of jobs and the drive towards net zero all at stake.