The number of onshore oil and gas wells drilled in the UK in 2016 was the lowest for nearly 50 years, according to data from the Oil and Gas Authority.
Five wells were drilled at four sites, all within a 40-mile area of Lincolnshire.
This compared with eight wells drilled in four counties in 2015 and 19 wells in eight counties in 2014.
The last time the number was as low as five was in 1967 and 1968.
The 2016 wells were drilled by three operators: Egdon Resources, Blackland Park Exploration Ltd and Wingas Storage UK Ltd. All the wells were said to be for conventional oil and gas and all spudded (the start of well drilling) between January and March 2016.
One of the five, at Laughton-1, north of Gainsborough, did not find commercial hydrocarbons and was plugged and abandoned. The operator, Egdon, said the site had been fully restored to agricultural land. That well was near Kiln Lane, a well drilled in 2015 in which Egdon had an interest and was also abandoned.
Egdon also drilled Keddington-5, a sidetrack of the production well, Keddington-4, east of Louth. The new well was designed to target an undrained area of sandstone. The company estimated production of 309,000-566,000 barrels but has not yet confirmed whether the well is commercially productive.
Blackland Park added a well to its Whisby field west of Lincoln and Wingas drilled two wells at its field at Saltfleetby on the coast north of Mablethorpe.
The data from 2016 suggests a continuing downward trend since 2011 (with the exception of a small rise in 2014).
The low oil price could be part of the explanation. But historically, there’s been no clear relationship between oil price and number of wells drilled.
Ken Cronin, chief executive of the onshore industry body, UK Onshore Oil and Gas, put it down to the 14th licensing round announced in December 2015 and confirmed during the past 12 months:
“In 2016 we saw a new onshore licencing round and in a year when there is a fresh licence round you would normally expect less new drilling.”
The previous licensing round, the 13th, was in 2008. That year saw 45 wells drilled, an increase of 11 on the 2007. But drilling fell to 25 wells in 2009 and 22 in 2010.
Will 2017 see an increase in drilling activity?
Several oil and gas companies have said they have planning permission and are preparing to drill wells at onshore sites during the next 12 months.
- Cuadrilla at Preston New Road site (site work started 5 January 2016)
- Europa Oil & Gas at Bury Hill Wood/Holmwod-1, near Dorking in Surrey
- IGas at Springs Road, Misson in Nottinghamshire
- Egdon Resources at North Kelsey, near Brigg, in Lincolnshire
- Union Jack Oil at Biscathorpe near Louth in Lincolnshire
- Angus Energy at Brockham in Surrey and Lidsey near Bognor Regis in West Sussex
- UK Oil & Gas Investment at Broadford Bridge-1, near Billingshurst in West Sussex