Jeremy Beckman • London
Sevan bid clinches Goliat
Eni Norge has chosen Sevan’s cylinder-shaped FPSO for its Goliat development in the Barents Sea. Sevan was one of two contractors vying in a front-end engineering design (FEED) competition, the other being Aker Solutions with its concrete-hulled Condeep MonoFloater.
Sevan is now working on post-FEED engineering under a separate, NOK150 million ($21.76 million) contract. The proposed concept, the Sevan 1000, will be the largest of the buoy-type floaters designed by the company to date, capable of producing oil at 100,000 b/d, gas at 3.9 MMcm/d (138 MMcf/d), and with oil storage capacity of 1 MMbbl.
Goliat, now expected on stream in 2013, will be the first oilfield project in the Barents Sea. Various measures will be adopted to quell environmental concerns, including supply of electrical power direct from the shore in an attempt to limit CO2 emissions; and use of ballast tanks in the sides and bottom area of the steel hull to limit leaks from the oil containment system. The entire process plant will be enclosed to protect both equipment and crew during winter.
Aker Solutions remains in the running for the engineering, procurement and construction contract. All previous Sevan FPSOs have been built in the Far East, followed by outfitting in Rotterdam.
Investor gloom dents UK activity
Exploration drilling on the UK shelf remained strong last year, according to the latest survey from Oil & Gas UK. The association identified 109 exploratory and appraisal well spuds, including sidetracks, but activity started to dip in the final quarter.
The picture looks gloomier going forward, with operator members revealing plans for only 34 firm E&A wells in UK waters this year, plus another 33 “non-firm” wells. In 2010, the survey identifies only 10 firm E&A wells at present.
Investor confidence is largely to blame, with capital increasingly hard to come by. Lower oil and gas prices are also impacting development, according to the survey with many planned projects barely economic at even $50/bbl. Cost inflation is another issue: in recent years the UK industry has had to spend more to extract fewer barrels. If trends continue, investments in new and existing UK fields could slide from $7.17 billion in 2008 to $3.58 billion in 2010.
Hot spots emerge in Moray Firth
Despite the tail-off in exploration, wells in the UK North Sea continue to deliver. In the Moray Firth, Maersk discovered gas and condensate in the Culzean structure in block 22/25a, south of the Atlantic and Cromarty fields. The high-pressure/high-temperature well encountered a substantial hydrocarbons column in Mid-Triassic to Triassic-age reservoirs.
Map locates Maersk Oil’s Culzean discovery in the Moray Firth.
In the same region, Houston-based Endeavour managed a successful up-dip appraisal of the undeveloped Rochelle find in block 15/27, which the company acquired in 2006. The well intersected 77 ft (23.5 m) of net gas-condensate pay in Lower Cretaceous Kopervik sandstone: recoverable reserves could be over 30 MMboe, better than pre-drill estimates.
Endeavour’s partner, Nexen, made an oil discovery of its own with the Hobby well in central block 20/1N, 1.5 km (0.94 mi) west of its recent Golden Eagle find. It plans to drill multiple sidetracks to delineate the extent of both structures.
High-performance development drilling last year also helped Nexen prove a further 29 MMboe of reserves at its central North Sea Buzzard complex. Later this year, Nexen expects to install the jacket for a fourth platform with production-sweetening facilities to treat high levels of hydrogen sulfide.
Noreco in mood to merge
Stavanger-based Norwegian Energy Co. (Noreco) has proposed a merger with Det norske oljeselskap, which would create the largest E&P independent on the Oslo stock exchange. The combined group would have interests in various discoveries and 100 exploration licenses in Norway, Denmark, and the UK, and production totaling 18,000 boe/d.
It would also have a market capitalization exceeding NOK4 billion ($580 million), with no need for additional equity funding for its investment programs, according to Noreco. The proposed share exchange ratio would favor shareholders in Det norske, giving them a 52.5% ownership in the new entity.
Det norske, however, has its own views on the way forward, having appointed a new board and chairman, Diderik Schnittler, the latter a former managing director of Saga Petroleum. It also has been talking with what it terms “a foreign actor” concerning a potential strategic and financial cooperation.
Offshore Norway, the company operates 27 licenses, and this year plans to participate in 15 exploration wells. Its targets include the 10-80 MMboe Grevling prospect in production license 038 in the North Sea – here it recently increased its acreage position following a swap of license interests with Talisman Energy Norge. If a well here is successful, the company might opt for development through Talisman’s Varg floater, 20 km (12.5 mi) to the south.
Sonsub recently completed its operations on Total’s Frigg sea lines decommissioning project in the North Sea. The scope of work included preparation, removal and disposal of all infield pipelines within a designated 500-m (1,640-ft) zone, plus power cables, umbilicals, communication lines, grout and sand bags, and concrete mattresses. The program required the services of two vessels, theNormand Cutter and the multipurpose support vessel Far Sovereign. The latter recovered all infield flexible and small diameter rigid lines using a reverse reeling method, a first for Sonsub.
