Statoil tables plan for Gjøa
Statoil has submitted a development plan for the Gjøa field in the North Sea to Norway’s Ministry of Petroleum and Energy. The partners are aiming for first oil and gas in 2010, produced via a semisubmersible platform with subsea wells. At that point, Gaz de France will take over as production operator.
Aker Kvaerner already is penciled in for the $1.3-million platform contract, the scope of work comprising detail design of the topsides and hull, topsides procurement, construction and hookup, and subsequent mating of the topsides to the hull. Grenland has been contracted for the subsea structures.
Gjøa oil will be piped to the terminal in Mongstad, north of Bergen, via a tie-in to Troll Oil Pipeline II. The gas will head to St Fergus in Scotland through the UK’s Flags trunkline system. The $4.4-billion project also calls for tiebacks of the Hydro-operated gas-condensate fields Vega and Vega South to the platform.
The field lies in blocks 35/9 and 36/7, 70 km (43 mi) north of Troll and 45 km (28 mi) west of the Norwegian coast. Statoil estimates reserves at around 40 bcm of gas and 83 MMbbl of oil and condensate.
Assuming the company’s merger with Hydro goes through, it could develop the Astero structure, also in the Troll area. Hydro’s recent exploration test on this 2005 find proved oil and gas in a new section, named Astero B. The location is 8 km (5 mi) north of Fram Vest, which produces via the Troll C platform.
Hydro also has notched its third new oil discovery in the Oseberg region within the space of 18 months. The well, drilled from the Oseberg B platform, encountered oil in the Statfjord formation underlying the Brent reservoir, the source of all Oseberg’s production to date. Hydro plans to develop the first of these new finds, B-South, via a long-reach well from the Oseberg South platform.
Decommissioning on the rise
Remaining decommissioning expenditure in the North Sea is around $42 billion in 2007 terms, says a new report from Wood Mackenzie. Around 48% of this will be spent in Norway and 40% on UK fields.
To date, says the report, 40 North Sea fields have been abandoned - 23 in the UK, 11 in Norway, and six in The Netherlands. A further 66 fields are either in the process of decommissioning or undergoing preparations for facilities abandonment. Most of the removal activity will take place 2015-2031, peaking at around $1.5 billion/year.
In the Norwegian and UK sectors, independent operators are looking at new ways to re-develop prematurely abandoned fields. In acknowledgement of this trend, UK Chancellor Gordon Brown recently announced that from July 1, fields in this category would no longer incur petroleum revenue tax (PRT). Malcolm Webb, chief executive of the UK Offshore Operators Association, welcomed the move, pointing out that UK fields developed before 1993 currently pay high levels of corporation tax as well as PRT.
In the Southern Gas basin, Star Energy looks to convert the decommissioned Forbes field to a new gas storage role. The company has formed an agreement with block operator Virgo to conduct a feasibility study, which would also involve acquiring new 3D seismic over Forbes.
Petrofac expands operations portfolio
North Sea facilities management specialist Petrofac has assumed duty holder responsibilities at two more UK field centers. One is ExxonMobil’s Camelot in the southern sector, which produces gas via a normally unmanned platform with six wellheads. The other is BHP’s Liverpool Bay development in the Irish Sea, where Petrofac is now in charge of the jackup operations support vesselIrish Sea Pioneer. The contractor has worked on this project since its inception in the 1990s, the scope of its responsibilities gradually increasing. It now has over 250 professionals committed to the operation.
Petrofac is the new duty holder of the jackup support vesselIrish Sea Pioneer.
In the far north of the UK sector, Petrofac’s Resources division was recently approved as operator of block 211/18a, containing the undeveloped Don Southwest discovery. This followed the acquisition of interests previously held by BP and ConocoPhillips. The company also holds 50% of adjoining block 211/18c - awarded under the UK’s 23rd Licensing Round - in partnership with Valiant Petroleum. The two partners plan to assess tieback development opportunities for the blocks, with Murchison, Magnus, and Thistle the likeliest host platforms.
Ireland could solve gas shortage
The barely explored southern Irish Atlantic margin could emerge as a lynchpin of Europe’s gas supply network, according to Tom O’Reilly Jr., CEO of Providence Resources, at a recent conference in London.
Providence is a Dublin-based independent holding minor production interests in the UK, but potentially major exploration areas off west and southwest Ireland. The company is pinning its hopes in particular on Phillips’ 1981 discovery Spanish Point, the Dunquin prospect 150 km (93 mi) to the south, and the 15-block Goban Spur acreage, awarded last November.
Providence operates Spanish Point with 80% of the license, the remainder being held by Sosina. Its most recent subsurface work here and at the adjacent oil discovery Burren suggests potential reserves of 1.4 tcf (but from a tight gas reservoir), and 160 MMbbl of oil.
Dunquin is a much bigger prospect that Providence acquired in 2004. Following interpretation of newly acquired 2D seismic, it estimates in-place gas at up to 20 tcf, with oil of 4 bbl. These figures drew in ExxonMobil as 80% farm-in partner in February last year. The two companies are also collaborating on the 4,000 sq km (1,544 sq mi) Goban Spur permit, in an area ExxonMobil knows very well, according to O’Reilly.
In 1981, he pointed out, there was no indigenous demand in Ireland for gas. The country’s gas supply infrastructure is still coming together slowly. The latest offshore development project, Corrib, has been delayed by approval problems and will only feed through 1 tcf at best.
However, the western deepwater basins remain “massively under-explored,” O’Reilly says, with only 38 wells drilled in the last 30 years. “Europe desperately needs more reliable and secure source of gas,” he said. One or two large discoveries “could lead to Ireland becoming the beginning of the European supply network, not the end, as at present.”
Jeremy Beckman, London
