UK company Jersey Oil & Gas has a road map that will lead to a final investment decision next year for the Greater Buchan offshore oil project, which it considers the third largest undeveloped field in the UK North Sea.

The Greater Buchan project is a redevelopment of a field that was prematurely shut down in 2017 following a production facility failure.

Phase one of the redevelopment has a potential resource of more than 100 million barrels of liquids on a best estimate basis.

The project received a big vote of support last month when Neo Energy, the UK company backed by Norwegian investor HitecVision, agreed to farm in for a 50% operator interest in the Greater Buchan licences.

Jersey said on Wednesday that the main focus is to finalise a preferred development solution then move into the front-end engineering and design phase.

In addition, a field development plan will be submitted to the regulator, the North Sea Transition Authority for approval in the first half of 2024.

Various development solutions are being considered including tie-back options to existing offshore platform infrastructure and potential floating production, storage and offloading vessel options.

Project sanction is targeted for next year, notwithstanding the challenges presented by the UK Energy Profits Levy which Jersey said has significantly harmed the industry’s borrowing capacity.

Jersey said it believes it is sensible for the UK government to provide some guidance on a price floor to facilitate the continuation of vital domestic energy supplies.

There was a silver lining, however, which was the introduction of an investment allowance that is specifically ring fenced to attract capital spend into new investments, added Jersey.

This means that a full taxpayer in the North Sea has the ability to secure substantial tax relief through investing in new projects such as Greater Buchan.

Jersey chief executive Andrew Benitz said: “2022 was an instrumental year in securing the future success of the company. The GBA (Greater Buchan) farm-out process involved extensive interactions with multiple counterparties during the year, culminating in the transaction that was announced in April of this year with Neo Energy.

“The GBA is a high-quality re-development, which is on track to generate significant value for the company and its shareholders.

“With the route for execution of the development programme now firmly established, the company looks forward to unlocking the many value catalysts that mark the run up to approval of the project and beyond.”