Dragon field comes up short

Hopes of finding a gas field off the coast of Wales have diminished after Marathon Oil has failed to find reserves.

Offshore staff

(UK)-Hopes of finding a gas field off the coast of Wales have diminished after Marathon Oil has failed to find reserves.

The company had been drilling at the Dragon Field off the coast of Pembrokeshire since the autumn in the hope of finding enough natural gas to make commercial extraction viable.

But the company, which had deployed a rig about 21 mi from St David's Head, yesterday admitted the search was over.

A spokesman for Marathon, which operates off the coast of Ireland, Norway and in the North Sea, said tests had proved unsuccessful, adding, "The well drilled on the Dragon prospect offshore Pembrokeshire late 2005 did not discover hydrocarbons."

A find in the field would have meant construction of a subsea pipeline to the Welsh coast, which could have been ready by 2008. Deputy leader John Allen-Mirehouse of Pembrokeshire County Council, said the news was a disappointment, because this also struck a blow to the prospect of construction jobs and an influx of spending for the local economy.


He added, however, that "It does not affect Pembrokeshire's growing reputation as the energy capital of Wales. The latest unemployment figures show that Pembrokeshire was only one of three local authority areas in Wales to show a drop in jobless totals in December.

"This is mainly due to other energy-related developments - such as the construction of the LNG [liquefied natural gas] terminals."

The terminals, which are due to be operational by late 2007, had been instrumental in persuading Marathon to drill, as had plans for a new power station in the area.

Meanwhile environmental campaigners, who had given tentative backing for the project with gas being seen as preferable to coal and oil, said the outcome was one they had been half expecting, and called for investment in 'clean' energy such as wind power.

Gordon James of the Pembrokeshire branch of Friends of the Earth Cymru said, "I'm not entirely surprised at the results. For a number of years companies have been exploring in the Irish Sea but we've not heard of any significant finds - certainly in British waters. This now should be an opportunity to look at alternative sources of clean energy from wind, wave, tidal and so on."

As for Marathon's future plans in the area, they are said to be exploring other options, and have been working closely with various Welsh agencies. The company had first explored the Dragon Field in 1994 and found 80 bcf of gas. Increasing demand for gas in the UK prompted them to take a second look.

The company has invested about ₤12 million in its search, and would have needed to find 250 bcf to make the project commercially viable.

Speaking before the testing started in October, Marathon Business Manager Mike O'Neill had said, "This is important because of the diminishing levels of gas available off the North Sea. Changes in the market and developments with the LNG terminals have made it more of a possibility."

01/24/2006

More in Company News