The Lancaster field is in relatively shallow water and Hurricane believes the early production system can prove the commerciality of the acreage while opening up nearby assetsdanny lawson/PA

Regulators have approved Hurricane Energy’s plan to develop part of its Lancaster field to the west of Shetland. About $500 million will be spent on what is seen as a key development for the area.

Hurricane is planning an early production system to extract up to 17,000 barrels of oil a day to show the viability of what is believed to be the largest undeveloped discovery on the UK continental shelf. Independent reports estimate that Lancaster has 523 million barrels of recoverable oil, with the initial production system aiming to extract 37 million over a six-year period.

The area west of Shetland is still relatively unexplored mainly because of the difficult weather conditions in the area and the need for deepwater drilling in many parts,…