Jeremy Beckman
London
Operators buy back North Sea gas
With so much talk in Britain of power utilities pulling out of gas supply deals, or renegotiating the price downwards, the safer option for an operator in UK waters these days is to sell its gas to itself. The latest to form a gas marketing company is Amoco, in a joint venture with electricity utility Seaboard.
Supplies, which will be sold to domestic as well as industrial consumers, will come initially from Amoco's share of the newly producing Bessemer and Davy Fields in the southern North Sea.
The venture also boosts prospects for development of several other Amoco-operated prospects nearby, such as Bell, Whittle and Wollaston, and Telford in the central North Sea. The former are candidates for monopods, while Telford is expected to be tied back subsea to Amerada Hess' Scott platform.
Mobil owns its UK gas marketing company 100%: that company has secured Mobil's share of the 153 bcf Galahad Field, which came onstream last month 64 miles off Norfolk, for onward sale to power generation and other industrial users.
Galahad, originally discovered in 1975, was not considered feasible until last year when its potential was confirmed through an innovative dual lateral well (subsequently converted to a producer). A second well was drilled this year which included the longest horizontal section drilled by Mobil to date, at 5,000 ft. The success of these wells made a third well unnecessary, lowering the cost of the development.
Drilling resumes in outback regions
At Trafalgar John Brown's Port Clarence yard in Teesside, England, the accommodation module and helideck for BP's Andrew integrated deck were recently lifted into place. Andrew is a medium-size oil and gas development scheduled for start-up next July in UK blocks 16/27 and 28.
Frontier drilling programs planned or in progress include Statoil's first wildcat in block 6204/10, 30 km off mid-Norway. This 12th licensing round acreage is being drilled in 189 meters of water byDeepsea Bergen. Last month the rig was also on duty for Statoil in the Danish North Sea targeting the Siri structure in 60 meters of water. Prospectivity is assumed to be strong, as Siri was only awarded this summer under Denmark's 4th licensing round.
Starting January, British Gas will explore block 97/19, 20 km off Portland Bill on the English south coast. A jack-up will drill to a depth of 2,300 meters under a 40-day exercise: numerous environmental studies have been performed on the acreage which was secured by British Gas and Agip in 1993.
Two new discoveries to report: twice-sidetracked well 22/30a-14, completed by semisubSedco 714, encountered gas/condensate and oil for Shell in the central North Sea Merganza prospect. Merganza lies between the Heron and Scoter Fields.
Elf Petroland confirmed a gas find in Dutch block J3a. JackupNeddrill 9 drilled the well from the nearby Markham J6-A platform, flowing 56mcf/d through a 60/64-in. choke. A production licence is now being sought for the J3a block, which could lead to the new field producing by year-end: gas would be sent to the J6-A platform for processing, heading from there to the Dutch coast via the WGT pipeline. With these extra supplies, the platform will be at virtually full capacity.
Total has just raised its stake in the 700 bcf Markham Field to 13% through buying Ranger's percentage.
Norwegian oil reserves up again
OPEC will not be pleased by a series of reports from Norway which have upgraded oilfield reserve estimates.
Saga has raised the production profile on Snorre by 100 MM bbl to 1.128 billion bbl, partly through use of gas injection and also location of further reserves in the south of the reservoir. The new figure represents a 47% hike on the estimate in 1987 when Snorre was on the drawing board.
Output from Norsk Hydro's Oseberg recently topped 1 billion bbl: that was the originally targeted figure, but 2 billion bbl now seems more likely following enhanced recovery measures such as gas injection from the Troll Field. Production is expected to tail off in two years time, triggering development of satellites east and south of Oseberg with reserves of 230 MM bbl. Operating costs from the field have declined to NKr4.80/bbl, currently the lowest on the Norwegian shelf.
On the debit side, oil reserves for the unitized Aasgard Field off mid-Norway have been downgraded to 774 MM bbl following new reservoir analyses, but gas quantities have been marked 11 bcm higher at 232 bcm.
Floaters under protracted negotiation
A PDO for Aasgard was due to be submitted to Norway's planning authorities mid-December. One of the project team's members, Morten Ruth, claimed that a semisubmersible floating platform would be a NKr1 billion cheaper option for producing the field's gas than a concrete monotower, the solution Norway's work-starved yards probably hunger for. The cost of Aasgard development is currently set at NKr28 billion, still NKr4 billion above Statoil's target.
Other North Sea floater projects have been somewhat in abeyance, for various reasons. Negotiations between Smedvig and Esso Norge over the sale of the newbuild SPU380 for the Balder Field dragged into November. Although a fee had been agreed - $295 million - the extent of Smedvig's involvement in the Balder development remained to be cleared up. Plans for the vessel itself are firmer: production capacity to be raised to 85,000b/d, with topside packages built in Europe (the vessel itself was built by FELS in Singapore).
Confirmation was pending that Conoco was selecting the Maersk-owned tankerDagmar Maersk for its UK North Sea MacCulloch oilfield. Following conversion, production could begin in December next year. The 40MM bbl field has a projected five-year life-span, with peak output of 35,000b/d.
The following year, Aran Energy's 36MM bbl Connemara Field could finally swing into production, assuming shareholders have approved Statoil's takeover offer. The two companies have agreed first to appraise the field in two work phases, which would include reprocessing seismic and an extended well test.
One company not enamored of floaters is UK engineering group Trafalgar House, which finally managed to sell its production semisubEmerald Producer. The facility, which had been working on MSR's Emerald Field, had run up losses over the past three years as the project hit production problems. It has been sold to Norway's Seatankers Management Co.
Back with Aasgard, the project, assuming it gains development approval, could be the first application of a new deepwater drilling, completion and maintenance vessel planned by Statoil. The proposed drillship, developed with consultant Kverndokk og Eldoey (Norsk Swath) in Aalesund, would function in water depths down to 1,500 meters.
The twin-hulled vessel, costing around NKr550 million, would be 100 meters long and 40m wide and would be dynamically positioned. Statoil claims that for well completions on Aasgard, it would work out NKr500 million cheaper than a semisubmersible drilling rig. Gullfaks is another prospect for completion support. However, a construction contract needs to be placed soon in time for the anticipated delivery in spring 1997.
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