The UK Department for Business, Energy & Industrial Strategy (BEIS) has explicitly defined R&D Tax Credits. This briefing will help you determine the types of Upstream projects that are eligible and what costs could qualify.
The Scientific or Technological Advance must be relative to the current industry baseline within Upstream. Hence it can't be that you are applying Technology for which there is already a publicly available reference. Likewise, it can't be a commercial, business or functional Advance - it strictly must be a Scientific or Technological Advance.
R&D can often be found in exploration, reservoir engineering and subsurface development, as modelling and geophysical workflows often have to be developed. These are typically eligible R&D for Tax Purposes.
There are many potential types of R&D in this field, which can include the "appreciable improvement" of simulations to match production output better.
Alternatively, the integration of technologies, in a non-standard way, to develop a new drilling process, which may either be more efficient, or more cost-effective than other known drilling methods.
Furthermore, other types of uncertain projects can be eligible, such as developing new or improved processes to deal with difficult locations or chemicals.
The key point around the Technological Advance is that you must be going forwards from the industry baselines of knowledge and capability, which means that you can't just be coping, or reusing information in the public domain.
In subsurface projects, this may include seismic interpretation, workflow and model development.
In drilling, this may include detailed Technical studies.
As well as the costs directly relating to the overcoming of Technological Uncertainty, project management, can be included in the claim.
Costs of materials consumed in R&D, such as for prototypes, can also be included within an R&D tax credits claim.