12 August 2020
Pandemic oil price plunge, a divesting partner and short timeframes before licence expiry are making it increasingly likely that Corallian and co will not be coming back to our beautiful, biodiverse bay.
A key partner to the Poole Bay oil well project has indicated that the drilling rig will not be returning to local waters.
In late February and early March last year, oil and gas company Corallian, alongside three smaller licence-holders, drilled an appraisal well in Poole Bay in search of crude oil.
The joint venture partners expected to find an estimated 23 million barrels of oil in the area titled ‘Colter Prospect’, but their first appraisal came back without results. An appraisal to the south of the original site, then returned with estimated findings of 15 million barrels of oil, raising fears for residents and campaigners of their impending return.
But in the year end reports from two of the four licence-holders, there are clear indications that the project is unlikely to go ahead.
UK Oil and Gas, who have a 10% stake in the licence, are preparing to divest from the project in favour of focusing on more lucrative oil and gas projects in Egypt.
Meanwhile, Baron Oil, with their 8% stake in Colter, reported that the slump in oil prices in March 2020, failure of attempts to acquire a new partner, alongside the need for another appraisal operation at the site before development of a commercial production well could proceed, made the project ‘unlikely’ to continue before the licence term ends in January 2021. They suggest that these factors also make it increasingly likely that they will be forced to relinquish the licence before the term ends.
Oil prices have seen a large decline during the height of the pandemic as large-scale lockdowns across Europe, Asia and the Americas put a halt to travel, industry and other fossil-fuel driven economic activity.
BCP Green Councillor Chris Rigby said of the news: "That the Baron Oil report suggests it is unlikely that drilling will return to Poole Bay any time soon, is great news for our local environment and a credit to the combined work of campaign groups across Dorset in highlighting the impact of drilling here."
Baron Oil’s annual report also mentions the adjacent landward licences in the Purbeck area. The Colter appraisal well findings indicated possible commercial oil deposits in these licence blocks, which lie to the south of the Wytch Farm oilfield. While the licence-holders initially showed interest in the possible future exploration of the area, Baron Oil’s report notes that “the combination of the current low oil price and the environmental issues associated with drilling in this coastal area of Dorset has led the directors to conclude that it will be difficult for drilling to take place before these licences expire in July 2021.”
Chris continued, "The story however, is far from over. We cannot return to the old normal, with a fossil fuel extraction at any cost attitude. If it's not in Dorset it will be somewhere else, the global environment is just as important as our local environment. Now is the time for change, a green recovery and investment in a resilient, sustainable future."
BCP's other Green Councillor Simon Bull added: "I hope that this is the end of plans to increase drilling in this area and an end to putting this beautiful region at risk unnecessarily. As a nation, we should be looking to renewables for our energy needs. It is illogical not to."
Poole Bay oil rig photo credit: Mick Gisbourne