Isle of Man announces licensing round moratorium: press
Isle of Man, the British Crown dependency governed autonomously from Westminister, has declared a moratorium on new exploration licences in its territorial waters, the BBC reported July 21.
The island lies just 146 km from mainland Great Britain, in the middle of the Irish Sea. Local upstream firm Crogga is currently managing the sole gas exploration licence in the area. Irish Sea sandstones have repeatedly demonstrated gas prospectivity since the 1980s, across multiple UK-awarded licences. But no gas has ever been monetised in the Isle of Man area. A previous well by BP in 1982 was judged uneconomic, despite encountering a 50-m gas column, with similar properties to the southern North Sea's Rotliegend sandstones.
An Isle of Man legislative proposal to ban all upstream extraction, helmed by Isle of Man Labour Party leader Joney Faragher, had threatened Crogga's efforts. Faragher's approach would have presumably meant suspending Crogga's contract, which covers acreage off the isle's Maughold Head region.
Isle of Man chief minister Alfred Cannan, the island's head of government, believed a ban on new licences to be more pragmatic. He was able to convince the island's parliament - the Tywnald - that Faragher risked creating "significant uncertainty" around Crogga's licence, which was approved "fully in conjunction of the law".
Environmental NGOs here argue the focus should be on renewables. And, as is often the case in politics, a cutting soundbite helps. Faragher has described Crogga's gas exploration push as a "big gamble on a sales pitch from a dying industry." Yet around 97% of the island's energy requirements come from oil and gas, and currently all of it is imported.
A consensus appears to have emerged to allow Crogga to pursue its exploration programme without encouraging further upstream activity. The chief minister Alfred Cannan has no political affiliation, and traditionally most Isle of Mann legislators have sat as independents. Crogga's existing concession was granted in 2018 but was extended out to 2024 in May. It includes scope for collecting seismic data.
The next stage of gas exploration at Crogga's licence should be wrapped up by early 2023, though seismic surveys here can only run from December to April, and even this is subject to the island's variable weather. Given the earlier BP discovery, Crogga's director Mark Pearce is "certain" gas will be found. The Isle of Man government has been promised a 5% production share if Crogga's licence is successful, as well as 52% of taxes levied on gas exports to Ireland.