Statoil has picked up the largest number of licenses in the Oil & Gas Authority's 29th Offshore Licensing Award focusing on frontier or underexplored acreage on the UK Continental Shelf.
In total, 25 licenses have been offered, covering 111 blocks. Some 17 companies, of 24 which applied, were offered licenses.
The 29th Licensing Round was the first licensing round in two decades to focus solely on frontier, under-explored areas of the Rockall Basin, which is west of Shetland, the Mid-North Sea High, and part of the East Shetland Platform.
Statoil has been offered four licenses, focused on the Northern North Sea, home to its Mariner heavy oil development, with three firm exploration well commitments. It is also the only company to have such commitments to drill, as part of its license obligation. Most others have committed to reprocess 2D or 3D seismic and have a drill or drop agreement on their acreage.
Other oil majors offered licenses are Shell, with west of Shetland blocks, BP, east of Shetland, and Esso, also west of Shetland. Others include Centrica (Mid North Sea High), Taqa Bratani (Northern North Sea) and a tranche of independents. See the full list below.
The Rockall and Mid-North Sea High areas were the focus of a 2015 UK Government funded seismic acquisition program, which acquired an extensive new geophysical dataset. The OGA subsequently provided an openly available, subsurface data package allowing companies to identify and target a range of opportunities. This was cited by companies as critical to stimulating their applications.
Andy Samuel, OGA Chief Executive, said: “The £20 million investment in new seismic for the Rockall and Mid-North Sea High areas, subsequent release of 40,000km of new and reprocessed data, combined with the work of the MER UK Exploration Task Force in developing the Innovate License, and a stable and competitive fiscal regime has resulted in a number of quality applications in this frontier Licensing Round.
“We are particularly pleased to see firm well commitments, the targeting of new and under-explored plays, and first-time entrants to the basin, alongside a number of established companies, which will help stimulate further activity and value creation.
“While exploration activity has undoubtedly suffered as a result of the difficult market conditions, we are now seeing highly encouraging success rates and finding costs on the UKCS.
“The upcoming 30th Offshore Licensing Round will focus on mature areas and is expected to be the most significant offshore round in recent decades. An extensive number of prospects and undeveloped discoveries will be on offer."
The 30th Round is likely to be announced during the latter half of 2H 2017, and will be open for 120 days.
The OGA’s 2016 Supplementary Round, which closed this month, attracted 15 applications for 11 blocks. Awards will be announced later this year.
The 17 companies (appointed the license administrator) are:
- Alpha Petroleum, with blocks 3/6 (part)
- Ardent Oil, blocks 36/15 (part), 36/20, 37/11 (part) and 37/16
- Ardent Oil, blocks 36/24, 36/25, 37/21, 37/22 (Split), 37/23 (Split), 37/28b & 37/29b,
- Azinor Catalyst, blocks 14/8, 14/9, 14/10, 14/13 (Split), 14/14 (Split), 14/15 (Split) & 15/11b
- Azinor Catalyst, blocks 14/13 (Split), 14/14 (Split) & 14/15 (Split)
- BP, blocks 210/4a, 210/5a, 210/5b, 210/9a & 210/10,
- Centrica North Sea, blocks 35/24, 35/28, 35/29, 35/30, 36/21, 36/26, 36/27, 36/28, 36/29 & 42/2a
- Chrysaor, blocks 37/17, 37/18, 37/19, 37/22 (Split), 37/23 (Split) & 37/24
- Decipher Energy, blocks 3/7c (Part), 3/8c (Part) & 3/12 (part)
- Decipher Energy, blocks 38/27, 38/28, 44/2 & 44/3 (part)
- Esso Exploration, blocks 132/3b, 132/4, 132/5 (part), 132/9, 132/10, 132/13b, 132/14, 132/15, 132/18, 132/19, 132/20 (part), 133/11 (Part), 142/28 (Part) & 142/29 (part)
- Nautical Petroleum, blocks 3/16 (part), 3/17 (part)
- North Sea Natural Resources, blocks 27/3, 27/4, 27/5, 27/9, 27/10, 28/1 & 28/6
- Shell, blocks 202/2, 202/3, 204/17, 204/21, 204/22b, 204/26, 204/27, 204/28a, 204/28b & 204/29b
- Shell, 204/18 (part), 204/19c & 204/20c
- Simwell Resources, blocks 29/22b, 29/23b, 29/27, 29/28
- Simwell Resources, blocks 41/3, 41/4 & 41/9
- Statoil, blocks 8/27, 8/28b, 15/2, 15/3, 15/7 & 15/8
- Statoil, blocks 9/17b (part) & 9/22 (part), with one firm well commitment
- Statoil, blocks 9/26 (part)
- Statoil, blocks 15/9 (part), 15/10, 15/14, 15/15, 16/6b & 16/11a with one firm well commitment
- Statoil, blocks 16/1c & 16/2a with one firm well commitment
- Taqa Bratani, block 16/7e, work commitment to be confirmed
- The Steam Oil Production Company, blocks 21/22 (part), 21/26 (part), 21/27b (part) & 21/28b (part), surrounding its Pilot field.
- Zennor, block 2/5b
"These awards are a result of a strategic decision by Statoil to explore in prolific but mature basins, combined with an emphasis on comprehensive regional work and investments in the most modern seismic datasets. In addition, we continue to diversify the UK portfolio by exploring in the true frontier areas such as the Rockall Basin." says Jez Averty, senior vice president for exploration in Norway and the UK in Statoil.
The Steam Oil Production Company says the blocks it has been offered contain the Blakeney, Feugh, Dandy & Crinan discoveries, the low-risk Bowhead prospect and the moderate-risk Titchwell prospect.
Steve Brown, CEO of the Steam Oil Production Company said: "We were delighted to learn that we are to be offered all the blocks we applied for and look forward to working with OGA and industry partners to progress a steam flood demonstration project on the Pilot field.
"The intention of this first phase, steam flood, development of Pilot is to prove that steam flooding can be successfully implemented offshore, and to learn how best to apply steam flooding offshore before committing to a full scale development scheme for all of the heavy oil fields on the Western Platform. Steam flooding achieves very high recovery factors in shallow, high quality sandstone reservoirs containing heavy oil."
It says the Blakeney field was discovered by Wintershall in 2010, and contains ca.90 MMbbl of moderately heavy oil in place, c. 14.5º API.
Feugh was discovered by Mobil in 1972, and other previous operators have considered Feugh to be a small gas pool. Steam Oil thinks Feugh has a 25ft oil leg beneath a thin gas cap, with ca.30 MMbbl oil in place.
The Dandy and Crinan discoveries lie down dip of Feugh and contain both gas and an oil, which is lighter and less viscous (ca.20º API) than that encountered in the rest of Steam Oil's acreage. Crinan (partly in open acreage) was discovered by Mobil in 1987 and in 1990 the 21/28a-6 well discovered oil and gas in what is now referred to as the Dandy South field. Wells were drilled by Monument, in 1998, to appraise the Dandy discovery. Together there are thought to be about 27 MMbbl of oil in place and 20 Bcf of gas in place in these three small discoveries.