THE Oil and Gas Authority (OGA) is taking a “short-term view” of the future of the North Sea industry by claiming it could have a new lease of life by exploiting billions of barrels of oil in “small pools” in UK waters.

Professor Alex Russell and Peter Strachan, two of Scotland’s leading oil economists, were speaking after the OGA said its research showed that more than three billion barrels were untapped and “unsanctioned” under the UK Continental Shelf (UKCS) and represented a “very significant opportunity”.

Carlo Procaccini, the OGA’s head of technology, said operators may have to develop new technologies to exploit these reserves.

“Small pools represent a very significant opportunity to maximise economic recovery from the UK continental shelf,” he said.

“Technology has an important role to play to reduce the cost of development wells, design optimised sub-sea infrastructure to existing host facilities and develop efficient standalone concepts.

“We are committed to working together with the industry, the Technology Leadership Board and the new Oil and Gas Technology Centre (OGTC), which has dedicated one of its Solution Centres to unlock the small pools potential.”

The academics, however, told The National the OGA would be better encouraging the exploitation of oil and gas by “safe fracking” in the North Sea.

Russell said: “The good thing I saw was that 89 per cent of that unsanctioned oil and gas equivalent lies in Scotland. What lies outside Scottish waters is fairly marginal.

“Back in 2014, there were claims made about 21 billion barrels of oil equivalent (BOE) still lying untapped in the North Sea underneath the Kimmeridge clay beds and that is unconventional oil and gas.

“In other words, it would be exploited using fracking techniques out in the North Sea – again, most of that would lie within Scotland’s waters.

“I think that would be a much better outlet for the OGA’s activities, to see if they could get their hands on almost the same amount of oil and gas equivalent that has already been extracted.

“That’s a longer-term operation, but I think they’re taking a short-term view and possibly sinking lots of money into that.

“I can see that maximising economic recovery for the oil companies in whose licensed field some of the unsanctioned reserves lie, but I’m not sure that would maximise anything to the UK taxpayer, or indeed increase in any material way the number of people employed in that exploitation.

“I’m not sure the OGA is going in the right direction. I can see some logic to it if it was in addition to catching the bigger fish, yes. However, contrast what they are about to do in England with regard to fracking on land and you have to wonder what the whole logic is.”

Strachan added: “I don’t know how exploiting these pools would affect decommissioning plans as well.

“You might find that would mean leaving a lot of pipelines and other structures down there that would otherwise be taken away in the short to medium term, with a view to using that infrastructure.

“What I would like to see is an analysis that says ‘this is the economic recovery that will come to the country, this is what the tax take will be’.

“And that has to take into account any repayment of taxes already paid by the companies who are prepared to spend more money to support the OGA getting their hands on the unsanctioned reserves.”

Russell said he would like to see who might be the winners and losers and “exactly if it would meet in any way maximisation of economic recovery”.

“For the amount of oil and gas involved, I’m not sure I’m totally convinced.”