NORTH SEA

The 6.5 km BP Cyrus bundle and two towheads being launched from Rockwater's Wester site in Scotland.

Exploration licences have been awarded for 26 West of Shetlands blocks in the UK's 16th offshore licensing round. Most are near to existing finds, close to the potential Tertiary gas structures in the north of the region, or consolidating existing acreage.

The main activists in the sector to date, Amerada Hess, BP, and Shell, each won eight awards: but this time, Shell will operate six of the blocks assigned to its partnership with BP. Amerada and BP are to share operatorship in two blocks (the first arrangement of its type in the UK since 1983's 8th Round). New operators in the region are Deminex and Kerr McGee, and US independent Mosbachar gains its first ever licence interest in UK waters.

These applications have been fast-tracked by the government to allow seismic programs to start this summer. Over 1,700 sq km of 3D seismic could be shot this year, followed by at least 25 commitment wells over the next three years.

Operators review abandonment notes

Britain's offshore operators' association (UKOOA) has welcomed the government's draft guidelines on abandoning offshore installations and pipelines. Although certain rules have been laid down - programs will have to address how to deal with oily drill cutting piles, and residual liability will remain with the installation owner in perpetuity - the government affirms that it will adopt a case-by-case approach to achieve a balance of safety, environmental protection and cost-effectiveness.

UKOOA is finalizing its response to these guidelines (due next month), and has also published its own advisory booklet, setting out the removal and disposal options.

A further document might be needed soon outlining how to remove Greenpeace activists. Having used Aberdeen police to extricate a group which inhabited the disused Brent Spar installation for three weeks, Shell decided to take no legal action against them. Subsequently, Greenpeace reinforcements re-boarded the spar, challenging the decision to dump the structure in the North Atlantic with allegedly radioactive materials onboard. Their views were supported at a recent ministerial North Sea conference in Denmark which criticized the UK government's policy.

No such problems yet in Norway, where the Storting has finally approved a plan to remove all offshore facilities on Elf's North East Frigg Field except the pipeline and umbilicals.

Another BP alliance reports savings

BP's Cyrus alliance, involving Rockwater, Brown & Root and fabrication venture Barmac expects to deliver significant savings on the design, procurement, fabrication and installation of the 6.5 km, 28-in. diameter flowline bundle and towheads. These have been installed under the project's first phase at 20% below the expected cost.

Cyrus, originally developed by BP's SWOPS vessel, is now being redeveloped as a satellite of Andrew, 6.6 km to the south. Two horizontal wells are to be drilled and tied back to the Andrew platform via the bundle, which contains a 4-in. gas lift pipeline, a 10-in. production flowline, a 2-in. methanol service line and control umbilicals. Baker Hughes Inteq is to construct and manage the wells on both fields which lie 50 km north-east of Forties.

Currently the alliance team hope to bring Andrew onstream six months early in July 1996 and £ 130 million under budget, at £ 320 million.

Elf Norge loses gas customer

Late May, Elf Petroleum Norge's Froey Field finally began producing. When the project was initially approved, an early '95 start had been envisioned, but modification work on Elf's Frigg TCP2 platform (fitted with a new process module to handle Froey's oil) extended the schedule.

Froey's 110 MM bbl of crude continue on in their processed state from Frigg to the Oseberg Field, via the Frostpipe line, and from there to the Sture terminal near Bergen. Associated gas (106 bcf in total) is heading down the Norwegian pipeline system from Frigg to St Fergus, Scotland - but not to UK utility Scottish Power, which has canceled a contract for Froey supplies. This is mainly due to continued wrangles over the Frigg gas treaty: Britain's government will not negotiate increased deliveries of Norwegian gas above quotas fixed some time ago.

Amoco, however, has concluded two new agreements for its 250-mile CATS pipeline, to transport gas for the Texaco Erskine and BP Andrew fields. This means that in 1997, the system will be handling over 1.2 bcf/d from nine separate fields in the central North Sea (next year it also takes on Phillips J-Block gas at a rate of 450 mcf/d). Now Amoco is looking to expand capacity in the line, possibly by creating a new looped section.

Further finds for Amoco, Marathon

Off the Norfolk coast in England, Amoco is appraising a new gas discovery known as North Inde which test flowed 52 mcf/d through an 88/64-in. choke. The exploration well penetrated two intervals in the Rotliegendes formation.

Around the same time, Marathon successfully re-entered its 1985 Braemar gas condensate discovery well 16/3b-8z, encountering a deeper hydrocarbon interval within the Upper Jurassic Brae formation that tested 9mcf/d and 530 b/d of condensate. The well, currently suspended, could be tied back to Brae facilities as a future development well.

Also in the UK, Mobil has won development approval for the 153 bcf Galahad prospect which lies close to its Excalibur and Lancelot/Guinevere Fields. Gas will be produced starting this November from horizontal wells, including the first multi-lateral horizontal well drilled in the UK North Sea. It will be transported 16 km to a tie-in point on the Lancelot pipeline and from there to Bacton for processing.

Galahad had been periodically reappraised since the first discovery well in 1975. Mobil has adopted Amoco's AMOSS design for the field's monopod, not normally manned platform.

In the Norwegian North Sea, Saga hopes to submit a PDO late this year for its marginal Varg (formerly Fenris) prospect, known to contain at least 40-50 MM bbl. Varg is some way from existing infrastructure, in block 15/12. Options are thought to be a floater or jack-up, removable swiftly when production peters out, or a floater with process facilities tied to a small wellhead platform. Finally, latest estimates for Statfjord's recoverable reserves suggest that the newly onstream Statfjord North and East satellites will yield almost 340 MM bbl, with daily production rising from 114,000 bbl currently to 140,000 b/d over the course of this year.

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