British Secretary of State for Energy and Climate Change Ed Davey issued a written statement to lawmakers Monday, saying the offshore oil and natural gas sector was a national priority in need of further review.
A review of the oil and natural gas potential on the British Continental Shelf hasn't been conducted since the early 1990s.
Davey said there may be as much as 20 billion barrels of oil and associated natural gas available to energy companies eager to work offshore. Declining production rates and aging infrastructure, however, presented long-term risks.
"I have come to the view that the challenges we now face are of sufficient importance that they merit a focused, in-depth review," Davey said.
Davey announced he appointed Ian Wood, former chairman of British oil services company Wood Group, to conduct a review of the offshore potential. His recommendations are expected in early 2014.
The British government said the oil and natural gas industry invested about $17.75 billion last year and is expected to spend at least $20 billion this year, making it the largest industrial contributor in the country.