"Agreement could not be reached and the application has been withdrawn" says DoI
The Department of Infrastructure has granted another extension to the licence agreement with Crogga which allows the firm to continue exploring the Island’s seabed for natural gas.
However, the energy company has withdrawn an attempt to vary its existing licence to skip conducting 3D seismic surveys and jump to drilling an appraisal well.
This decision comes in the same week a tribunal ruled that Crogga had unlawfully withheld deferred salaries from its founding director and former chief executive.
Crogga was ordered to pay more than £130,000.
The licence was originally issued in October 2018 and is comprised of three parts:
- Phase A: geotechnical studies and geophysical reprocessing
- Phase B: 3D seismic survey and acquiring other geophysical data
- Phase C: exploratory drilling
Government has already issued three licence extensions for Phase B to be completed; this latest two-month extension will be the fourth.
Phase B is estimated to cost approximately £12.75 million.
This funding was reportedly only to be used to pay off existing debts, and not intended to support the completion of 3D seismic surveys, leading to questions about Crogga's ability to "effectively develop the Island's hydrocarbon resources".
Instead of completing the surveys, Crogga has applied to vary the licence in 2022, seeking permission to bypass this step and proceed directly to drilling an appraisal well, relying solely on 2D seismic data from the 1990s.
Phase C is estimated to cost around £40 million, requiring further investment to move forward.
Manx Radio contacted the Department of Infrastructure earlier this week (19 December) to inquire whether government was reconsidering its dealings with Crogga in light of the tribunal findings.
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