WEST of Shetland-focused Hurricane Energy has praised the new North Sea oil and gas industry regulator for adopting a flexible approach to licensing formalities on its territory, which it said would increase the chances of the firm making progress.

The Surrey-based company said it was pleased to announce that the UK Oil and Gas Authority has allowed it to subdivide a licence West of Shetland into four sub areas, each of which contains a discovery or a prospect.

The OGA has also granted a two year extension on the requirement that Hurricane drill a well on the Lincoln prospect on one of the sub areas, until 31 December 2019.

Hurricane’s chief executive Robert Trice said the subdividing of the licence was an important step for the company, which would make it possible for other firms to invest in individual assets rather than having to buy into the whole licence.

In September the company made progress on the adjoining licence when the UK Oil and Gas Authority granted the Lancaster find on the acreage oil field status.

Mr Trice said then that the authority’s decision was an important step in progressing to first oil from Lancaster, which is estimated to contain 207 million barrels of oil.

The company is preparing a programme of appraisal drilling on Lancaster, which will help it determine if the field can be developed profitably.

Hurricane focuses on fractured basement reservoirs that lie beneath the sandstone level, which most North Sea exploration activity has targeted.

Hurricane expects to be able to produce from such basement reservoirs by tapping into natural fractures in the rock through which oil could flow.