Homing in on UKCS prospects

December 31, 2010

Things are stirring on the UK continental shelf if the attendance at last month’s Pilot Share Fair in Aberdeen is anything to go by. More than 1000 people, including Meg Chesshyre, turned out to hear from major operators and contractors about their strategies for future North Sea projects.

Major operators and contractors outlined their 18-month forward plans for future projects and appraisal in the North Sea at the UK’s 12th Pilot Share Fair in Aberdeen in early November revealing a substantial body of prospects. There were over 1000 individual face-to-face sessions, and eight presentations each by 20 companies from both the operator and contractor communities.

Brian Kinkead, Oil & Gas UK’s supply chain director, comments: ‘The feedback from the delegates has been very positive. Operators have been able to meet a wider cross section of the supply chain and raise their business profiles with new contractors. For the supply chain it has been an invaluable chance to hear about a huge range of planned activities and the technologies that will be required.’

BP’s major North Sea upstream projects 2010-15 are Skarv and the Valhall redevelopment in Norway, Devenick, Kinnoull, Clair Ridge and West of Shetland Quadrant 204 in the UK. Devenick is a £500 million development, comprising two gas wells tied back to Marathon’s East Brae platform. There will be a 16/10 in pipe in pipe chrome pipeline, a 250t manifold and a 750t topsides module and a new caisson riser at Brae. A drilling programme is due to start with the West Phoenix this quarter and first gas is due 2Q 2012.

The Andrew area development, containing Kinnoull, is another £500 million project. Drilling started on 1 October and is due to be finished 2Q 2011. Kinnoull will have three production wells and there will be further appraisal of the reservoir (SW and Northern extensions). Due to engineering constraints sanction has been deferred to 1Q 2011 with first oil targeted for 3Q 2012. There will be a 14in diameter, 29km bundle tied back to Andrew, with a diversion for the Arundel Tee, and a tie-in point for future subsea system at the Andrew riser base. There will be a new 700t reception module and a riser caisson at Andrew.

The Quadrant 204 development involves the replacement of the 17-year old Schiehallion FPSO. KBR has an engineering, procurement and managed services contract for the topsides, and JP Kenny for subsea. Bids for an FPSO with a topsides weight of 21,000t, are under evaluation. SBM has begun detailed design for the 28 slot, 9100t turret. There will be 20 new wells on Schiehallion and five on Loyal.

The £3 billion Clair Ridge project involves two bridge-linked platforms, a new 6km, 22in diameter oil line and 14.5km 6in diameter gas line. All the packages have been prequalified with the majority out to bid. Amec is BP’s engineering and management contractor through a BP global agreement. The jacket contract has been awarded to Aker and the heavy lift contract to Heerema Marine Contractors. Five wells will be pre-drilled and there will be 31 platform wells.

On the abandonment front, BP is looking at the decommissioning of the Valhall 2/4G riser platform; the Amethyst platform, subsea and pipelines; and the Miller platform and subsea. A contract for Don and NW Hutton pipeline decommissioning has just been awarded to Helix Well Ops.

Centrica is planning up to 13 field development projects over the next four years. For the Ensign field, all direct contracts have been let, but significant subcontracting opportunities exist. Project sanction for the York field is due this quarter. It will comprise a six-slot NUI platform. Two well slots will be used for York South and one for York East. There will be a new production line, plus a 3 1/2 in diameter methanol line to Easington. South York drilling is due to start 4Q 2011, pipeline installation in 2Q/3Q 2012, and platform installation 2Q 2012 ready for first gas 3Q 2012.

Project sanction for the Rhyll subsea tieback to North Morecambe is due 1Q 2011. Rhyll drilling will start 3Q 2011 and pipelay of the 11.9km export line 2Q 2012, ready for first gas 3Q 2012. On the decommissioning front, there is the removal of the Kittiwake SAL base 1H 2011, and pipeline cleaning and engineering works for Rose decommissioning in the same period.

For Chevron, the major UKCS capital opportunities are Alder and Rosebank. For Alder long lead items such as wellheads, trees and valves will be procured 1H 2011, and topside EPC and subsea EPIC contracts in the second half of the year. Seismic acquisition stage two for Rosebank will take place 1Q 2011, followed by seismic processing 2Q and phase two/three FEED 4Q.

For ConocoPhillips, current projects include the three-platform Jasmine development, where WorleyParsons has engineering design, Rosetti jacket fabrication, and Saipem transport and installation; Britannia longterm compression, where Amec has engineering design involving a novel monopile support; and replacing the existing sulphuric acid plant at the Rivers terminal, being designed by Fluor. Subject to approval, the new facility will be available for production mid-2012. Potential future projects include a new NUI in the Southern North Sea, and a further subsea tieback to Britannia.

In 2009 EnQuest expended £440 million on third party services, £360 million via direct contracts with suppliers and £80 million via its duty holder contracts. In the near term, brownfield projects under review include a power upgrade on Thistle, rig reactivation/upgrade on Heather and water injection upgrade on theNorthern Producer. There are also satellite third party hosting options. There are a number of greenfield assets in the pre-development stage, including Peik, SW Heather and Elke.

Fairfield’s key objectives are to enhance existing production from Dunlin, increase focus on exploration, with appraisal drilling planned for the Darwin field, and detailed subsurface evaluation of Skye, block 6 and the Skylark fields, and to progress the Staffa and Crawford development projects. In May 2008 Dunlin production was 4000b/d, today it is over 10,000b/d. This is sustainable over the next 5-10 years with further opportunities to supplement with infill drilling.

Maersk projects for 2011 include a Gryphon life of field extension, plus the tie-in of new wells from Gryphon South and Maclure, a Janice life of field extension and an upgrade to the Global Producer 3. There will also be various subsea inspection repair and maintenance programmes (£4 million) over all the assets, an ROV inspection programme (65 days), including a pipeline inspection programme (£4 million) and decommissioning studies (£500,000).

Premier Oil’s producing assets are the Balmoral hub, which it operates, and stakes in Scott, Kyle and Wytch Farm. Its UK sector pre-development portfolio includes the possible tie-backs of Ptarmigan and Caledonia to Balmoral; the Scott satellites; Huntington, where first oil is due 4Q 2011; the Catcher discovery; Fyne and Solan. In Norway it has a stake in the Frøy redevelopment, Bream, where development options are being evaluated; the Grosbeak and Gnatcher discoveries; and is the operator for the Gardrofa prospect.

RWE Dea’s two main projects are Breagh and Clipper South. Breagh phase one received development sanction in June 2010 with first gas in 2012. Development sanction for phase two is expected June 2011. First gas from Clipper South is due mid-2012. There are also plans for additional wells on the Cavendish field and concept planning is under way for the Kepler discovery.

In the UK sector, Shell is planning permanent living quarters on Clipper, and is busy with Inde and Brent decommissioning. In the Netherlands, the work is mainly on land – the Groningen and Schoonebeck projects, while in Norway the giant Ormen Lange gas field is ongoing, as is the Corrib development offshore Ireland.

Talisman’s Auk North project is in the commissioning phase, with first oil looked for shortly. The Auk South redevelopment integrated drilling deck is due for sailaway from Rosetti 2Q 2012, and fabrication of the living quarters has begun at Consafe Engineering. Bidding processes for an HLV and a floatel are currently under way. At MonArb there are plans for a new bridge-linked platform.

First gas from Total’s Laggan Tormore west of Shetland development is looked for mid-2014. At peak production, the development will add in the region of 93,000boe/d. A final investment decision on the development of Tobermory as a tiein to the Laggan/Tormore system is due in 2013 ready for first production in 2016. The field is in a water depth of 1600m. There is also ongoing activity at Elgin/ Franklin and in the North Alwyn area – Islay.

On the contractor side, the newly rebranded OGN Group (Offshore Group Newcastle), previously SLP Production, said it was ‘business as usual’ at its Tyneside facilities – the Hadrian yard Wallsend. Led by chairman Dennis Clark and CEO Dave Edwards, OGN is currently working on the Forties Alpha satellite platform project for Apache, due for loadout in July 2012. The engineering was carried out in a joint venture with Altra Energy (OE August 2010). There were also presentations from AGR, Aker Solutions, Amec, PSN, Technip and Wood Group highlighting company philosophy, contracting strategy, current projects and points of contact. OE

 Project Pathfinder provides pertinent pointers

In response to supply chain requests for early information on emerging projects, the UK’s Department of Energy & Climate Change (DECC) has launched Project Pathfinder.

Offering a real-time look at UKCS oil and gas projects – both for new field developments and decommissioning of redundant facilities – over the next few years, the new service provides information on the location, type of development, and the timings of the opportunities as well as the all-important contact details within the companies concerned.

DECC said it had developed Project Pathfinder to ensure increased visibility to the contracting community and to build on the information available from existing forums such as the Pilot Share Fair and the Pilot Forward Workplan.



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