OFFSHORE EUROPE

Jeremy Beckman
London

Conoco's Boulton in the southern gas basin was producing 114 MMcf/d, thought to be the highest sustained rate achieved from any Carboniferous well in this area. The Atlantia-design jacket allows production wells to be carried inside the legs, reducing loads on the structure caused by wind/wave actions.

Route of the proposed Åsgard gas transport line, tying in supplies from Draugen. [29,754 bytes]

Development dominates drilling schedule

North Sea well plans are seemingly unaffected by the tumbling oil price. A survey of the operators' drilling intentions for 1998 suggests a total of 163 new well starts, virtually unchanged from last year's levels. Wood Mackenzie's survey does not, however, indicate any hot new exploration patches. Much of the predicted activity relates to field development backlogs in the UK and Norway.

Semisubmersible rig demand across the sector looks set to outstrip supply. In 1997, day rates for third and fourth generation rigs soared from $120,000 to $170,000 by year-end, with term contracts for deepwater work in 1998 fixed often at over $200,000/day. It's the same story for jackups, with heavy duty rigs in highest demand for central North Sea HP/HT roles. Day rates for this type of work are typically up from $98,000 a year ago to $150,000-plus.

Overall, the well count in the UK was actually down 13% last year, reflecting a shift to longer-term development drilling assignments. Development work should dominate again this year, with at least 12 new UK offshore fields forecast to come onstream, and larger ongoing projects such as Elgin/Franklin, Shearwater, Alwyn North and Bruce II continuing to soak up rig time.

Liberalization of Europe's gas market should sustain pockets of exploration drilling in the southern gas basin and The Netherlands. But the main exploration focus will still be on Mid-Norway, as operators there fulfill their obligations on large new acreage tracts opened up by the 15th Norwegian licensing round.

ARCO announced the North Sea's first noteworthy discovery this year, in the increasingly prolific Outer Moray Firth. The well, spudded in December by the semi Ocean Guardian, was suspended mid-January, having tested 40 MMcf/d of gas and unspecified condensate at flowing tube pressure of 1,800 psi. Flow rates were constrained by surface facilities.

Well 14/26a-6 was ARCO's second successive strike in the block following an oil, gas and condensate find, plugged by the same rig.

The accumulations are on trend with Texaco's Captain and Talisman's Ross fields, British Gas' presumed 200 million bbl discovery, Busby and Talisman's Cromarty oil and gas prospect, expected to be appraised shortly.

Shell's master plan progressing smoothly

Shell has gained government approval for two southern North Sea gas schemes costing #233 millon in total, aimed at extracting 590 bcf combined. The producer says it will invest #4 billion with Esso in the UK North Sea over the next five years.

Both the Ketch and Corvette fields will feature normally unmanned wellhead platforms in shallow waters. Ketch lies in Shell's Silver Pit complex, 106 miles off the southern Yorkshire coast, and will constitute Shell's second Carboniferous development. Seven production wells are planned, but there will be 12 slots on the four-legged, 2400-ton platform to handle potential gas pockets nearby. Gas will feed into Conoco's CMS export system via a new 17-mile. 18-in. pipeline, sized to accommodate any future finds.

Corvette was discovered only two years ago, 56 miles north-east of the Norfolk coast and 5 miles south of Shell's Indefatigable Field. Gas will be piped via the Leman A platform to the Bacton terminal, from where it will be remotely operated. Again, there will be provisions for future tie-ins.

Shell also has a 1996 gas condensate find in the South Halibut Basin, named Goldeneye, and is keen to fast-forward a development solution. The Lower Cretaceous discovery well tested 22 MMcf/d. The field extends south into Amerada Hess' block 20/4b, where a separate hydrocarbon-bearing structure has been identified.

A similar situation arose on the Bittern oil field, which straddled both operators' acreage. After extensive discussions, Shell gave in to Amerada's wish for a dedicated FPSO, currently under construction. But Goldeneye looks a more amicable affair. Both parties have agreed to co-evaluate data from the two wells and a 3D seismic survey shot by Shell in the prospect area last year. Amerada and its partners are also participating in Shell's current exploration well east of Goldeneye.

Tie-in boost for Mid-Norway gas

Norske Shell may have found a buyer at last for its Draugen Field associated gas. A 62-km pipeline could be laid from the Draugen platform in the Norwegian Sea to a T-junction on Statoil's planned Åsgard Transport gas trunkline. Draugen's output would then end up at the Kaarsto gas treatment plant north of Stavanger, but the tie-in would have to be effected next year. Three more T-junctions are planned for the Åsgard line this year to cater for projected supplies from future developments close to the route.

Another Statoil-owned treatment plant at Kollsnes, near Bergen, could receive gas from the Huldra Field from October 2000, if a recently issued PDO based on an unmanned wellhead platform is approved.

Newcomers flocking to Danish waters

Denmark's Energy Agency says 19 applications were received recently for acreage under the nation's 5th licensing round - seven more than for the previous round, which rekindled interest in Denmark following Statoil's Sirri oilfield discovery. There were also seven applicants new to the sector this time, including ARCO, Kerr-McGee, Marathon and Saga.

The Danish-speaking Faroe Islands will definitely stage their first licensing round this year, said Heialvur Joensen of the Faroese Petroleum Administration recently. But due to the unresolved dispute with the UK over median line waters, the most attractive acreage close to BP's West of Shetland fields (the White Zone) will likely be omitted. Lack of progress on this issue could dampen interest on both sides of the border area, although Saga appears undeterred. It has just opened an office in the Faroese capital, Toershavn.

Ripples of activity in Dutch sector

The Dutch sector continues to breed hope and despair. A core of six companies have been snapping up attractive gas prospects close to their main platform infrastructure. Clyde, for instance, has just acquired BHP's licences in Blocks G/16 and 17, as well as Conoco and Elf's interests in pre-Bunter horizon L Block licences close to Clyde's P6 complex.

Others come and go. Latest entrant is Century Offshore Management of the US, headed by an ex-Placid managing director. Century picked up a new 9th round exploration licence for Block E/14, close to the route of the probable NGT trunkline extension. But Vanco Energy has exited The Netherlands, having failed to secure license rights for Unocal's P18A and NAM's Q/13A offshore gas prospects.

A further lure to newcomers is newly available seismic - 2,550 line km - acquired by Fugro-Geoteam for the 9th round, covering the western flanks of the Central Graben.