UK and Norway’s diverging paths related to North Sea oil and gas exploration are generating very different outcomes.
From the overall fiscal environment to the offering of licenses, the two countries’ different approaches have resulted in a sharp contrast in the number of exploration wells drilled and the amount of resources discovered, analysts from Westwood Global Energy Group said during a recent webinar, “UKCS and NCS 2025 and Beyond—Same Basin, Diverging Outcomes.”
Aly Harding, technical manager at Westwood, said Norway’s government supports exploration on the Norwegian Continental Shelf (NCS), and the government is working to address the country’s approaching production decline. It contrasts, she said, with a mature UK Continental Shelf (UKCS), where there’s a lack of government support for the industry.
“Although the UKCS is very mature, there's still potential with discoveries being made, but this is being overlooked due to nongeological influences,” she said. “The investment is lacking in the entire life cycle from exploration through to production. Production rates are entering a period of unmanaged decline rather than a managed decline that would create value.”
And without investment, she said, there is a risk that UKCS fields, hubs, and infrastructure will cease early.
“Norway, on the other hand, has government support for exploration,” she said. “Although less mature, Norway is approaching production decline, and the government is looking to companies to address this and keep the production plateau out beyond 2030.”
Stephen Coomber, senior analyst at Westwood, said that while three exploration wells were completed on the UKCS in 2025, they were spudded in 2024. No exploration wells were spudded in 2025 on the UKCS, and only three are planned for this year, he said, in contrast with the NCS, where 33 exploration wells were completed. He added that 2025 marked Norway’s second-highest volume of discovered resources since 2013. In 2026, he said, 41 exploration wells and four appraisal wells are planned offshore Norway.
“The UK has been hit with a lack of investor confidence in all aspects of E&P, not just exploration. Why drill an exploration well if you'll not be able to develop a discovery? Will the infrastructure still be in place to tie back a discovery?” he said.
Over the years, the UK fiscal system has changed many times, often led by short-term policies, while Norway’s fiscal system has been more stable. With Norway’s production level “on the brink of decline,” he said, the Norwegian government is encouraging companies to sustain exploration activities and move forward with development projects.
Exploration Outcomes
From 2016 to 2025, there were 79 exploration wells drilled with 24 commercial discoveries finding 370 million BOE of resources in the UK, compared to 279 exploration wells drilled with 93 commercial discoveries finding 2.62 billion BOE of resources in Norway.
Many of the successes were related to infrastructure-led exploration (ILX) rather than those classified as high-impact, which Westwood classified as prospects targeting more than 100 million BOE of resources, or those in frontier areas, Coomber said.
In short, he said, “the UK failed to have big discoveries,” and Norway discovered seven times more resources than the UK.
“In the UK, what might be discovered if policy changed and more wells were drilled?” he asked.
Licensing Rounds
Harding said Norway’s Awards in Predefined Areas (APA) 2025 contrast significantly with the UK’s 33rd Round, which spanned 22 months from launch to award.
“The 33rd Round was a long, drawn-out process,” she said. “By the time all awards were finally made, some companies had lost interest in the UKCS, as they no longer saw a future. Twelve of the 88 offers were not accepted.”
Norway’s APA program is intended to provide a steady cadence of licensing opportunities, and the 2025 round saw 57 licenses awarded to 19 companies, she said.
The future of exploration offshore the UK is further complicated by the country’s proposed switch from licensing rounds to Transitional Energy Certificates (TECs), she said.
Harding said the current definition of TEC is unclear and subject to interpretation, but the assumption is that blocks are only eligible for a TEC if they are unlicensed, contain a discovery, and are directly adjacent to licensed acreage with an existing field—potentially leaving prospectivity on unlicensed acreage stranded.
She expects TECs will limit opportunity. “Most of the people who have got licenses already would've already looked at nearfield exploration opportunities. I mean, that was being done 20 years ago. So, really, you need to look further beyond the license outlines if you want to find additional resources. So, it is going to absolutely limit opportunity,” she said.
Switching to TECs could result in 13.4 billion BOE of risked prospective resources and 1.3 billion BOE of contingent resources becoming inaccessible, she said. An estimated 1.8 billion BOE exists on unlicensed acreage that could be eligible for TEC.
A further wrinkle in that scenario is what happens with unlicensed UK acreage that could be potential extensions from Norway discoveries, she added.
Exploration 2026 and Beyond
Harding said only three exploration wells and no appraisal wells are expected to be spud offshore UK in 2026.
Norway should see 41 exploration wells and four appraisal wells spudded in 2026, she said, adding, “Norway needs to learn from what has happened in the UK.”
