Subsea tiebacks buck the trend

June 8, 2011

Earlier this year, Douglas-Westwood forecast † the industry will spend $139 billion on subsea hardware 2011-15, a 23% jump on the previous five years, with the deepwater Golden Triangle inevitably dominating the anticipated spend. Despite the trials and tribulations of the past year, the Gulf of Mexico's subsea tieback activity levels remain high, as Jennifer Pallanich shows in this regional roundup.

The post-Macondo deepwater drilling moratorium put a halt to the momentum the Gulf of Mexico had seen over the last few years. At least a few deepwater subsea tiebacks – defined as those in over 1500ft of water – have begun production since last year's report (OE April 2010): Anadarko's Callisto field, Apache's Balboa, and Newfield's Gladden.

On the other hand, a lack of permitting for exploration, appraisal and development wells means progress has slowed in many fields, and the results will be felt for a few years. But permitting delays aren't the only issues that stalled progress in the Gulf.

Anadarko's Caesar/Tonga tieback project was expected to go onstream in mid-2011, but a faulty riser is delaying first production to 2012. In January, Anadarko said hydrotesting revealed the riser system ‘was not fit for service'. Anadarko, which operates the project, is working with its partners to secure an alternative production riser. One option under consideration is a traditional steel riser while the other is a flexible riser.

Two of the wells for the development flow-tested at over 15,000b/d. Completion activities were under way at the third well in early May. Caesar, a 2006 discovery in 4500ft of water, is in Green Canyon block 683. West Tonga, a 2007 discovery, is in Green Canyon block 726. The two fields are tying back to Anadarko's Constitution spar in Green Canyon block 680. Anadarko operates the development with 33.75% interest on behalf of partners Statoil (23.55%), Shell (22.45%), and Chevron(20.25%).

The operator has brought Callisto onstream. That field is producing about 40mmcf/d of gas to the nearby Independence Hub platform. Callisto, in 7800ft of water, was discovered in 2001. It is located in Mississippi Canyon block 875. Anadarko operates the field with 100% interest.

Following Apache's acquisition of Mariner Energy, Apache has now begun production at its first operated deepwater development in the Gulf of Mexico. The Balboa field, in East Breaks block 597, went onstream in late December 2010 and has been producing at about 30mmcf/d of gas and 1400b/d of oil from the field in 3350ft of water. The one-well development ties back to Anadarko's operated Boomvang spar six miles away on East Breaks block 643. Apache operates Balboa with 50% interest.

ATP expects production from the third well at Telemark to begin early 3Q 2011. The company received a permit mid-March from BOEMRE to resume drilling at the development's third well – at Mississippi Canyon block 941 #4 – and has requested approval to drill a fourth well, this one at Mississippi Canyon block 942 #2. In early May, ATP said the #2 well could begin production in 4Q 2011, pending approval from the government. The Telemark development began production in March 2010 (OE April) to the ATP Titan, a Min-DOC facility moored in 4000ft of water. As of earlier this year, the facility was receiving production from the #4 well at Atwater Valley block 63, known as the Telemark field, and the #3 A-1 well in Mississippi Canyon block 941, which contains the Mirage field.

The ATP Titan will also receive production from the Morgus field in Mississippi Canyon block 942. ATP operates the Telemark Hub with a 100% working interest.

In mid-March, ATP said operations were expected to begin this year at Clipper in Green Canyon block 299, pending permitting. Less than a month later, BOEMRE announced it had approved ATP's permit to carry out completion operations at Clipper. The 2005 discovery lies in 3450ft of water.

Noble Energy, a partner in the BP-operated Galapagos development project, expects first production from the trio of fields in 2012. The fields included in the project are the 2007 Isabela discovery, the 2009 Santa Cruz discovery and the Santiago discovery. The fields are to be tied back to the nearby Nakika platform at Mississippi Canyon block 474.

In April 2011, the Ensco 8501 resumed drilling operations at the Santiago field, after drilling was suspended in June 2010 following the deepwater drilling moratorium. Noble Energy was the first company to receive a permit to drill in deepwater once the agency resumed awarding permits.

Noble Energy said the total gross potential for the Galapagos project is 260 million boe. Isabela is in Mississippi Canyon block 562, and Santa Cruz and Santiago are in Mississippi Canyon block 519. Project sanction came in 2009. Water depths are about 6500ft in the region. Noble Energy operates Mississippi Canyon block 519 with 23.25% interest on behalf of partners BP (46.5%), Red Willow Offshore (20.25%), and Houston Energy (10%). BP operates Mississippi Canyon block 562 with 67% interest on behalf of Noble Energy (33%).

Chevron's Tahiti project went onstream in 2009, and the supermajor has Phase II under way to keep production levels at 135,000b/d. Tahiti 2 is a waterflood project expected to begin in 2012; it earned sanction in 2010. Tahiti 2 is in Green Canyon 640 in water depths over 4000ft. The main Tahiti field spans Green Canyon blocks 596, 597, 640 and 641. Wells are producing from pay sands in the Lower and Middle Miocene to the Tahiti truss spar installed in 4200ft of water.

Subsea 7 won an engineering and installation contract to install one 7.5in, 13,000ft long flexible riser, one 4in, 4,500ft long umbilical, five rigid well jumpers, 10 electrical flying leads and seven steel flying leads. Subsea 7 will also transport the flexible riser from Le Trait, France, to the Gulf of Mexico. Subsea 7 will carry out the installation of the riser and the umbilical in 3Q 2011 and the five tie-ins through mid-2012. Subsea 7 will use the Seven Oceans pipelay vessel, the Skandi Neptune construction and flexlay vessel, and the Ross Candies light construction vessel for the work. Chevron operates Tahiti with 58% interest on behalf of partners Statoil (25%) and Total (17%).

The DGE-operated Condor field in Green Canyon block 448 is due onstream shortly. The field is being tied back to the Marquette facility at Green Canyon block 52. The field was discovered in January 2008. When partner LLOG announced the discovery, it said the well had penetrated over 85ft of oil-bearing sand.

LLOG anticipates beginning production from its Goose field in Mississippi Canyon block 751 in 1H 2012. The field, discovered by Spinnaker in 2003, will be a single well subsea tieback to LLOG's existing Valley Forge production manifold at Mississippi Canyon block 707. Spinnaker put its discovery on hold because of a lack of nearby host facilities, effectively stranding the asset, and leading the company to release the block. LLOG acquired full interest in the block in 2009.

At Mandy, located in 2465ft of water, production is expected to begin by year's end. The Mississippi Canyon block 199 field, which LLOG discovered in early 2010, is a two-well tieback to the W&Toperated Matterhorn TLP at Mississippi Canyon block 243. The discovery well encountered over 120ft net TVD oil pay, and the appraisal well in a separate fault block encountered over 100ft net TVD of oil pay. LLOG anticipates completing a third well on the block for future tie-in. LLOG operates Mandy with 50% interest, and partner Apache holds the remainder.

Marathon aims to have first production from its Ozona Deep project in Garden Banks block 515 by the end of 2011. The field in 3280ft of water ties back to the nearby Shell-operated Auger platform. The company sanctioned the 2001 discovery in 2008 as a one-well development. Marathon operates the project with 68% on behalf of partner Marubeni (32%).

The Murphy-operated Dalmatian field in DeSoto block 48 is expected onstream in 2013. The field, discovered in 2008, is located in 5876ft of water. Newfield, a partner in the Dalmatian field, has said the 2010 discovery of Axe will be produced through the Dalmatian infrastructure.

Newfield has brought its Gladden field in Mississippi Canyon block 800 onstream. The 2008 discovery, located in 3116ft of water, is producing at 5000boe/d.

Newfield expects its operated Pyrenees field at Garden Banks block 293 to begin production late this year. The company carried out a sidetrack at the field in early 2010. Newfield operates the 2009 discovery in 2100ft of water with 40% interest. Stone Energy is a partner in the field.

Noble Energy is considering a trio of solutions for developing its Gunflint discovery in Mississippi Canyon blocks 948/949 because of the current uncertainty on resource size. The 2008 crude oil discovery could be developed as a subsea tieback, or to a modified existing platform, or to a newbuild platform. Noble Energy said using a subsea tieback approach would allow the company to accelerate the completion schedule, ‘potentially absorbing time lost to the deepwater moratorium and permitrelated delay'. The company had planned to drill up to two appraisal wells in 2010. It anticipates drilling an appraisal well at Gunflint this year and plans to use the results to determine the best development scenario. Noble Energy aims to have Gunflint, located in 6100ft of water, onstream in or by 2015. Noble Energy operates Mississippi Canyon block 948 with 37.5% interest and Mississippi Canyon block 949 with 43.75%.

At Raton South, Noble Energy is working to bring the 2008 discovery onstream by the end of this year. Located in Mississippi Canyon blocks 204, 248 and 292, Raton South in 3400ft of water is being tied back to a non-operated host facility.

Next up in Noble Energy's plans is the Redrock tie back, once Raton South begins production. Redrock is in Mississippi Canyon block 204. The 2006 discovery is located in 3334ft of water.

Shell plans to make a final investment decision this year on the Cardamom Deep development at Garden Banks block 426. Located in 2860ft of water, Shell plans to develop the field as a tieback to its nearby Auger TLP. The original 1995 Cardamom discovery has produced to the Auger TLP since 1997. OE


World Subsea Hardware Market Report 2011-2015 (first edition), Douglas-Westwood, 2011.



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