The DESNZ stated on Wednesday that new oil and gas licences can now be issued if they do not require new exploration.
The Department for Energy Security and Net Zero (DESNZ) confirmed on Wednesday that licences can now be granted for developments that utilise current platforms and facilities. This represents a modification from earlier restrictions on new licensing.
At the same time, the government has maintained the existing fiscal framework for the sector, including the Energy Profits Levy (EPL). The levy, currently set at 38 percent when prices exceed specified levels, brings the overall headline tax rate to 78 percent for affected producers. The EPL is scheduled to remain in place until March 2030.
Industry representatives have highlighted the need for fiscal stability to support ongoing investment.
Offshore Energies UK CEO David Whitehouse said: "The future of North Sea energy depends on investment, which won't come without urgent reform of the windfall tax. If the levy stays in place beyond 2026, projects will stall and jobs will vanish, no matter how pragmatic licensing policy becomes."
North Sea production has decreased significantly over recent decades, from approximately 4.4 million barrels of oil equivalent per day at the beginning of the century to around 1 million currently, according to the North Sea Transition Authority (NSTA). Output is projected to continue declining in the coming years as fields mature.
Offshore Energies UK's analysis indicates that earlier adjustment of the fiscal regime could support higher long-term tax revenue and help sustain domestic production levels. The organisation noted that maintaining the current levy structure without change until 2030 could lead to a faster reduction in output and increased energy imports.
Under the newly announced North Sea Future Plan, the government will introduce Transitional Energy Certificates to facilitate continued development at existing sites while aligning with broader energy transition objectives.
Additionally, £20 million has been allocated to create a North Sea Jobs Service aimed at assisting workers and communities in the region.
The policy update seeks to balance energy security requirements with the UK's longer-term climate goals by enabling managed production from established infrastructure while directing new investment primarily toward low-carbon technologies.
