Canadian operator's plans spark revival in Moray Firth

Map shows discoveries to date in the corridor along the Outer Moray Firth, currently under investigation for joint development possibilities [11,389 bytes]. Talisman hopes to extend the producing lives of the Beatrice platform (above) and those on Clyde and Buchan through to 2005 [27,910 bytes]. The hull of the FPSO Bleo Holm under escort on the River Clyde, western Scotland, where outfitting is nearing completion [45,736 bytes].

North Sea reservoirs targeted by Talisman

Jeremy Beckman
Editor, Europe
Frontier Atlantic exploration may hold the key to Britain's oil and gas future. But there is still plenty of near-term potential in the more accessible central North Sea.

Over the past two years, drilling campaigns in the Outer Moray Firth off northeast Scotland have generated two important discoveries, including British Gas' reportedly 100 million bbl plus oilfield Blake and Shell/Amerada Hess' Goldeneye.

There have also been numerous smaller finds stretching west across the firth towards the mainland, including the Hannay oilfield and Arco's gas strike in block 14/26a.

Now efforts are under way to develop these and other technical reserves along the route, lessening the cost through use of common infrastructure - some of which does not yet exist. Genesis Engineering Consultants is studying the options for these operators, which have named themselves the South Halibut Basin Operators' Forum.

Of the five member companies, Calgary-based Talisman has been a pivotal figure in the Moray Firth's "regeneration." Having established itself as a North Sea player through buying Bow Valley in 1994 and subsequently Goal Petroleum in 1996, it then acquired several producing properties from BP in the central part of the North Sea, including the Beatrice platform close to the mainland. Shortly afterwards, it bought BP's controlling interest in the Ross oilfield in the central Moray Firth, which is currently undergoing development.

During 1997-98, Talisman has bolstered its position in the central North Sea through a series of transactions which established the North Sea as its fastest-growing region, with daily production up 40% on 1996 levels at 67,200 boe. That total will be boosted by 20,000 b/d of oil when Ross comes onstream early next year.

Declining interest

According to Nigel Hares, Vice-President, Frontier & International Operations, when Talisman first "arrived" in the North Sea in 1994, it was viewed as a maturing province, although less mature than North America was at the time (prior to the deepwater frenzy). Having made the big discoveries following the early high-risk exploration phase, the majors appeared to be losing interest in the smaller fields and discoveries.

Talisman decided to fill that gap by pursuing a strategy of intensive exploration and development of core areas around existing infrastructure. One way to do that was to acquire mature producing assets, extending their fields' lives through proving-up satellite discoveries, and reducing lifting costs on the producing asset.

An opportunity arose in summer 1996, when Talisman reached agreement to buy BP's interests and operatorships in the Beatrice, Buchan, and Clyde fields in the central North Sea. Along with the Thistle Field, they had been grouped into the Mature Asset Team (MAST) project, which aimed to prolong these fields' economic lifespan through innovative technology applications. Thistle, however, remained with BP.

At the same time, Talisman furthered its infrastructure plans by also buying BP's operating interest in the Nigg Bay crude reception terminal in the Cromarty Firth. "Our thought on Nigg," says Hares, "was that with the new FPSO-style developments emerging in the North Sea at the time, there was a need for a storage and transhipment terminal business that could grow. When we bought it, BP was negotiating a contract with Texaco for the new Captain Field's oil. We also have a number of other third party transhipment deals through Nigg."

Field history

Beatrice began producing oil in 1981, peaking in 1985 at 54,000 b/d. This had declined to 10,000 b/d by summer 1996. Development prior to the transaction had included two main platforms plus satellite production and water injection facilities, with oil exported to Nigg via a pipeline.

Talisman subsequently bought 100% ownership of Beatrice. It identified numerous opportunities to increase recovery through infill drilling - much of the oil in place is in poorer quality reservoirs - and also through waterflood improvements. A 3D seismic survey was conducted in anticipation of two new sidetrack wells, and water injection in two wells was reconfigured, raising production from 9,000 b/d to 11,000 b/d.

Clyde is Talisman's most southern asset in the central North Sea. Production started in 1987, based on a fixed steel platform, soon reaching a peak of 52,000 b/d of oil and 23 MMcf/d of gas.

The oil is exported to Phillips' terminal at Teesside, UK, via the CNSEP pipeline, while the gas heads to St Fergus in eastern Scotland through the Fulmar gas line. Two small satellites, Medwin and Leven, were later brought onstream through deviated wells drilled from the platform. At time of purchase, oil production was down to 15,000 b/d, with an estimated 36 million bbl and 5 Bcf still to be recovered.

Clyde's reservoir

Half of Clyde's remaining oil in place is in the tighter, upper reservoir with the other half in the more permeable lower reservoir. Talisman decided to concentrate on the upper reservoir, a policy which paid off last year when two new horizontal sidetrack wells were successfully drilled, producing initially at 2,800 and 7,500 b/d. The latter was successfully perforated underbalanced and using coiled tubing-conveyed perforating guns over a length of 1,465 ft in one run, reportedly a world record at the time.

The plan is to keep drilling at least two new horizontal sidetracks each year, all producing around 4,000 b/d. "We can see quite a number of locations to address," Hares says, "which would not involve a huge extended reach. However, there are not many spare slots left on the platform, so we will use a well that has been played out for sidetracks."

But the major action to come on Clyde is the planned subsea tieback of the 20 million boe Orion Field, in which Talisman has an 86% interest. Orion, in block 30/18, was acquired from British Gas this spring. The field, discovered in 1985, lies 16 km east of the Clyde platform.

A pre-development test well was recently drilled successfully on Orion. Talisman plans two horizontal wells and a subsea flowline back to the platform.

"We want to keep costs really low, with a bare minimum of modifications on Clyde," says Hares. "We won't change the gas processing arrangement - we'll just put in a new riser and a separator. The field should be onstream before the end of 1999." Wood Mackenzie has estimated capex for the project at £70 million. The 30/18 acreage may also hold further exploration potential.

Buchan, located east of the Ross Field, has produced oil through a converted semisubmersible rig since 1981, with oil exported through the Forties system. Estimated oil recoverable when Talisman took over was 13 million bbl. Subsequent re-interpretation of faulting in the field and new 3D seismic analysis suggest that estimate was conservative.

Buchan's riser

One problem Talisman is trying to address is Buchan's fixed riser system. In bad weather, this has to be pulled, which leads to around two weeks' lost production each year. "The rigid riser also means that well intervention is restricted and difficult," says Hares, "and we can't sidetrack existing wells. So we're looking at replacing the riser with a flexible system to cut maintenance and weather downtime.

"This would also allow us to attempt coiled tubing drilling from a semisubmersible, which would be a first anywhere. We have a lot of experience with coiled tubing onshore in Canada. We'll decide on this in the next few months. The reservoir has a lot of upside potential - the water cut is 25% currently, compared with 23% two years ago, so it's not depleting too fast. Unusually for the North Sea, the reservoir is fractured and low pressure. Applying conventional drilling practice, we might damage the well - so coiled tubing drilling may be the answer."

Next year a step-out well is planned in the Amerada Hess-operated Hannay oilfield, 8 km north of Buchan. Hannay was discovered in 1996 through a well that tested 9,600 b/d. Talisman has a 22% share and may offer Buchan as the host facility, although Amerada's Rob Roy floater may also be in the running.

A few miles north of Buchan, Talisman is attempting another life extension on the Blenheim oilfield. Blenheim is produced through the leased FPSO Petrojarl 1, which also handles output from the single-well tieback from the subsea Bladon Field, 5 km to the north.

Increasing water cut threatened to close down production on Blenheim by the end of the year, which prompted Arco to sell its interests in both fields to Talisman. By working closely with the FPSO's operator PGS, Talisman hopes to eke out further reserves and delay decommissioning. It has identified several low-risk exploration prospects nearby, one of which may be drilled this year.

Ross area potential

Another exploration stronghold is emerging for Talisman around the Ross Field. It has several prospects which could be incorporated in the SHBOF plan, which Hares compares to the recently completed ETAP multi-field development, also in the central North Sea. Among Talisman's operated prospects are:

  • Phoenix - a 100 Bcf, 15 million bbl condensate technical reserve 20 km north-west of Ross
  • Cromarty - a gas accumulation in block 13/30a which may extend into block 14/26a, site of Arco's gas discovery, which tested 40 MMcf/d early in 1998.

Talisman believes that a key technology for the next phase of North Sea developments is to extend the distance of current subsea tiebacks. Feasibly, some of its Moray Firth prospects might be within reach of the Ross FPSO. Ross contains an estimated 70 million bbl of oil and 25 Bcf of associated gas. The field is expected onstream early in 1999, a little behind schedule, with likely capex of around £180 million, according to Wood Mackenzie. Five producer and four water injector wells are currently being drilled.

Talisman plans three exploration wells on Moray Firth prospects next year. Depending on the results of these and exploration wells by other operators nearby, some sort of joint SHBOF development could take shape by late-1999, possibly split into an eastern and western area, says Hares.

Copyright 1998 Oil & Gas Journal. All Rights Reserved.

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