April 1, 2006
Norway’s reserves in good shape

Jeremy Beckman • London


Norway�s reserves in good shape

Norway’s remaining recoverable reserves stood at 8.5 bcm of oil equivalents at year-end, virtually unchanged from the 2004 figure. According to the Norwegian Petroleum Directorate, which issued the assessment, this total still represents more than twice the volume recovered since production started on Ekofisk in the 1970s.

NPD identified six new discoveries across the shelf in 2005, with potential combined reserves of up to 16 MMcm of oil and 119 bcm of gas. It also estimates there are a further 3.4 bcm of oil equivalents waiting to be discovered, comprising 1,160 MMcm of oil, 420 MMcm of condensate, and 1,900 bcm of gas.

As of December 31, NPD says, eight new Norwegian fields were under development, including the Marathon-operated Alvheim cluster, close to the North Sea border with the UK.

Earlier this year, Alvheim’s FPS hull sailed from the Keppel Shipyard in Singapore to its topsides outfitting location at the Vetco Aibel yard in Norway. The completed floater should be towed to the field early next year.

Under the current project, Alvheim is tying in production from four fields - Boa, Kameleon, Kneler, and Vilje - with combined reserves of 200-250 Mboe.

Marathon is also expecting approval from the Norwegian government to factor in the 2004 Hamsun discovery, since renamed Volund, as a 10-km subsea satellite tieback.

Mature blocks out to bid

More ‘mature’ acreage has been put out to bid under Norway’s latest licensing round. The 2006 Awards in Predefined Areas comprises 192 blocks or part-blocks across the North, Barents, and Norwegian Seas. This total is 11 up on the 2005 figure, and represents Norway’s third-largest licensing round to date. Bids are due in by September 29, with licenses likely to be issued during December.

Statoil is one of numerous major players with designs slated for the Norwegian Sea. It recently strengthened its position here by acquiring BP’s 25% interest in license 218, covering blocks 6706/10 and 6706/12. The acreage includes Luva, a 38-bcm gas find in 1,300 m of water, and the general area is thought to be gas-prone. Assuming remaining partners ExxonMobil and ConocoPhillips endorse Statoil as the new operator, they may drill a well on a nearby prospect in 2007-08.

In the North Sea, Statoil and its associates in the Statfjord consortium have managed to lower the field’s operating costs by $104.2 million, a year ahead of schedule, mainly through redeployment or early retirement of 200 personnel. These savings are part of a longer-term scheme to maximize the field’s life and profitability - the major component, the Statfjord Late Field Life project, involves raising the gas recovery factor from 54-75%.

Redundant pipelines groomed for new role

Britain’s pipeline network in the southern North Sea could be re-deployed for new uses, once the region’s main gas fields have been depleted.

So claims the East of England Energy Group in a new report, sponsored by the UK government, the offshore operators association, Ukooa, and four of the sector’s main gas hub operators.

The report claims there are almost 7,000 mi of undersea pipelines taking oil and gas in the UK mainland. Those in the southern gas basin are seen as more viable for alternative employment, as they are in general close to onshore terminals on England’s east coast such as Bacton, Dimlington, Easington, and Theddlethorpe.

Possible new roles might include:

• Transporting carbon dioxide from the mainland to the depleted offshore fields, either as part of a carbon capture/storage initiative, or to boost recovery in oil fields;

Transporting hydrogen produced in offshore separation plants; and

• Transferring gas by-products from coal gasification, arising following injection of oxidants into coal reserves.

Before any schemes could go forward, issues would need to be resolved such as change of pipeline ownership and ultimate decommissioning liability. A new body, possibly government-appointed, might also need to be created to operate the network.

Chevron goes for growth in Dutch sector

In the Dutch North Sea, Unocal Netherlands has unveiled its first major new project since its merger with Chevron. In partnership with Dyas, DSM, and Dutch state company EBN, it plans to produce up to 3.69 MMcm/d from gas on blocks in the A and B quadrants.

The scheme, known as the A&B development, relates to two exploration and five production licenses in this northern part of the Dutch sector.

Unocal and Dyas picked up this equity from the Shell/ExxonMobil joint venture NAM in 2004. Under a first phase, Heerema in Zwijndrecht is fabricating a central processing platform, to be located in block A12a. Gas will be exported through a new line, to be installed by Allseas, connecting to the A6-F3 trunkline to the Dutch mainland.

Talisman lines up new production complex

Assuming UK government sanction, Talisman would become the new operator of Shell/Esso�s Auk platform in the central North Sea.
Click here to enlarge image

Talisman Energy is close to establishing a new production hub in the UK Central North Sea. It has been negotiating with Shell and ExxonMobil to take on their combined interests in the mature Fulmar and Auk fields, both of which have been for sale for some time. Assuming the UK government’s blessing, Talisman aims to become 100% operator of both fields later this year.

Clyde and Orion, which it already operates, both export their production - like Auk - through the Fulmar facilities.

Talisman is not veering either from its tried and trusted exploration strategy, drilling targets producible from platforms. Recently, it discovered new oil in block 16/22, close to its Beauly field and 10 km from the Balmoral production semi. Talisman holds a 15.13% interest in the CNR-operated Balmoral field. It intends to evaluate the new find by factoring in reprocessed 3D seismic, with a view to a possible development.