Drilling down across NW Europe

Exploration drilling has picked up this year on the UK shelf, according to the latest North West Europe Review from Deloitte’s Petroleum Services Group.

Offshore staff


ABERDEEN -- Exploration drilling has picked up this year on the UK shelf, according to the latest North West Europe Review from Deloitte’s Petroleum Services Group. However, results have been disappointing, with no discoveries reported to date.

Deloitte identified eight new exploration well spuds in the sector in the first quarter, double the figure for the corresponding period in 2009. In marked contrast, appraisal activity was down by 70%, with only four new wells recorded.

Around 70% of the latest wells were on prospects in the southern gas basin and East Irish Sea, followed by the northern North Sea with 17%.

UK asset acquisition activity has also been quiet in the first quarter, with one new deal announced and one cancelled. This may be due in part to issues related to financing and decommissioning liabilities.

Offshore Norway, the review again identified 12 new well spuds in the first quarter, comprising 10 exploratory and two appraisal wells. This represents a drop of 25% on the previous quarter of 2009, a record-breaking year for new E&A well starts on the Norwegian shelf.

Most of the new wells this year have been in the North Sea, with the remainder in the Norwegian Sea. Unlike the UK, operators here have been rewarded, with five wells encountering hydrocarbons, and one exploration well due to be re-entered for completion in the near future.

There have been no asset transactions so far in 2010 in the Norwegian sector, and only one farm-in, Det norske’s acquisition of a 10% interest in license PL 392 from Norske Shell.

Off the Netherlands, just one well has been drilled in the past quarter compared with four in the same period in 2009. Two divestitures have been announced, but there is licensing activity in prospect. The Ministry of Current Affairs is inviting bids for exploration licenses covering blocks M/4 and L/11c.

4/8/2010

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