Houston-headquartered Apache Corporation has claimed it has increased its North Sea reserves by some four to seven times since the end of 2014.
In a trading update highlighting the performance of its North Sea business, focusing on the Forties and Beryls assets, the firm said: "Total net unrisked reserve potential in the North Sea is 574 MMboe to more than 1 billion boe, none of which was booked at year-end 2014.
"This potential represents an opportunity of four to seven times Apache's year-end 2014 proved reserves in the North Sea of approximately 145 MMboe."
Apache said this "significant reserves potential underscores longevity and upside for the region," a comment which will be welcome in a basin which has been suffering from low exploration rates, high costs and poor production effciency. In fact, the poor performance on the UK Continental Shelf led to a major review by industry veteren Sir Ian Wood in 2014, which let to the creation of a new industry regulator, the Oil and Gas Authority, and the UK Government funding new seismic acquisition for the first time.
The American independent has built a strong position for itself since entering the North Sea in 2003, when it bought the Forties field from BP, who at the time was looking to cease production on the assets in 2013. Apache has gone on to achieve 92% production efficiency and operates with a claimed 50% lower operating costs than the high-cost North Sea average.
With the addition of the Beryls fields in 2012, the firm has further increased its exploration potential and production base.
The firm's display of prowess over these assets follows talk of potential takeover bids earlier this month. Houston-based Andarko Petroleum revealed on 11 November that it had had a takeover bid for Apache rejected by the company.
"We believe that our international regions, and the North Sea in particular, have significant upside potential that will create value for Apache shareholders beyond its near-term free-cash-flow-generation potential," said John J. Christmann, IV, Apache's chief executive officer and president.
The Forties field has produced more than 2.6 billion barrels of oil and has recovered more than 50% of the resource in place over the past 40 years. With the size of the remaining resource estimated at nearly 2.5 billion barrels, even small incremental improvements in the recovery factor can result in significant reserve and production gains, Apache says. "Notably, every 1% increase in recovery factor equates to approximately 50 MMbbl of additional recoverable reserves."
Apache says Beryl is a geologically complex area with multiple fields and stacked pay potential, "providing significant exploration opportunity." Following the completion of the first 3D shoot since 1997, Apache recently announced two discoveries in the area and is moving ahead with development and additional exploration efforts.
Apache says that since the acquisition of the two fields, it has invested nearly $2.6 billion in infrastructure and it is now reaping the benefits of this investment, as a higher percentage of capital dollars is now being directed to drilling and production.
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Image: Apache's Forties Bravo platform
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