UK approves 10 million barrel North Sea Teal West oil field tie-in

The UK government has given the go-ahead for a 10 million barrel tie-in project in the North Sea known as Teal West, intended to boost oil flows through the Anasuria Floating Production Storage and Offloading vessel.

The approval, published by the Department for Energy Security & Net Zero, comes amid controversy over the future of the North Sea oil and gas industry, with the opposition Labour Party threatening a moratorium on new license approvals.

Teal West is expected to add around 6,000 b/d of annual production at its peak, in a best-case scenario, according to the environmental impact assessment submitted by project developer Hibiscus Petroleum, based in the Malaysian capital Kuala Lumpur.

The Anasuria facility was previously operated by Shell until it was taken over by Hibiscus and fellow Malaysian company Ping Petroleum in 2016. The Anasuria cluster produces light crude, with an API gravity of 37-38. Production from the current four contributing fields totaled 5,600 b/d in 2022, according to data from the regulator.

Hibiscus had expected to bring the new field on line in 2024, with production extending over 10 years. However, regulatory delays may have impacted that timeline. Hibiscus did not respond to a request for comment.

North Sea benchmark Dated Brent was assessed by Platts, part of S&P Global Commodity Insights, at $84.18/b on Aug. 2, down $1.10/b on the day.

The UK oil and gas sector is experiencing heightened uncertainty stemming from net-zero emissions goals and punitive taxation, as well as severe decline in production levels. Plans by Norway's state-controlled Equinor to develop the 325 million barrel Rosebank oil project in UK waters are now being closely watched as a bellwether for the sector.