1. OGA overview and update
5 May 2015

2. UKCS Challenges Economic challenges intensified since the Wood Review
Exploration & production decline
Increasing costs
Sharp decline in oil price
Brent $/barrel
Jan 2011
March 2015
An all-time low for exploration and appraisal activity in 2014
Lowest production revenue for nearly 2 decades
Significant falls in investment predicted over the next three years
Economic challenges intensified since the Wood Review

3. Prize of additional 3-4 billion boe 375,000 industry jobs to protect
2014 Wood Review
Key recommendations
Sector strategies
Urgent need for enhanced stewardship
New Maximising Economic Recovery strategy
New independent regulator with additional powers and resources
Commitment from industry to collaborate
Stronger tripartite relationship between industry, government and regulator
Prize of additional 3-4 billion boe ,000 industry jobs to protect

4. OGA focusing on priorities
A behavioural and cultural shift is necessary to tackle the challenges ahead
OGA will implement the key recommendations and actions identified in the Wood Review
The Government has recognised the need for ongoing fiscal reform with trusted advice from OGA
Industry must urgently take action to create a more competitive cost base
New independent regulator for the UK oil and gas sector
Maximising economic recovery of UK oil and gas resources
New regulatory powers, better resourced and funded
Catalyst for change and facilitator of action and collaboration
The OGA has a key role to play in driving action

5. OGA up and running and forming the team
Building the OGA
1 April
Q3 ‘15
Q3 ‘16
Feb
Commission Response
Executive Agency
Leadership complete
Critical mass to deliver
Government Company
DECC
DECC
DECC
OGA
Executive Agency
(Civil Service)
OGA
Government Company
EDU
LED
Historically
From 1 April
From Summer 2016
OGA up and running and forming the team

6. Establishing the early priorities for the OGA
Call to Action
Secretary of State Commission to address impact of oil price decline
Strong engagement from industry and government
Identified key risks facing the industry and immediate priorities
Integrated plan to create focus and accountability
Outlined clear actions for the OGA and industry
Establishing the early priorities for the OGA

7. Driving investment Future fiscal priorities
Petroleum revenue tax reduced from 50% to 35%
Future fiscal priorities
OGA, HMT and Industry continue working in close collaboration per Driving Investment Plan
overall tax burden fall
wider benefits considered
global competitiveness
Further work on options to incentivise exploration
Infrastructure, decommissioning and PRT
Decommissioning costs
Confirmation of new basin-wide investment allowance
£20m for new geophysical surveys
Supplementary corporation tax reduced from 30% to 20%
Industry, the OGA and the Treasury working well together

8. Leaders creating the new culture
Culture and behaviour
A catalyst for change
Cultural transformation
Strong relationships
A trusted advisor
Cost-conscious approach
Leaders creating the new culture

9. Good progress so far but lots to do
Looking ahead
Confirm and announce leadership team – May
Confirm and announce first NED appointment – July
Begin next wave of recruitment activity – July
Prepare draft bill for first session of Parliament following election – July
Publish Call to Action progress update – September
Complete consultation on MER UK strategy – September
Introduce levy – October
Move into new Aberdeen HQ – October
Good progress so far but lots to do