UK Buzzard oil-gas field starts production

Uchenna Izundu
International Editor

LONDON, Jan. 8 -- Buzzard oil field in the UK Central North Sea has come on stream and will bring an additional 200,000 b/d of oil to international markets later this year and 60 MMcfd of gas.

Buzzard, which is operated by Nexen Petroleum UK Ltd., has reserves of more than 500 million boe and the potential to deliver about 10% of the UK's annual forecast oil demand at peak rates. It is the largest North Sea discovery to be developed in more than a decade.

Buzzard production will be processed through a 12,000-tonne production deck (OGJ Online, June 29, 2006). So far nine production and five injection wells have been drilled. Buzzard will be developed with 27 production wells and 11 water injection wells.

Buzzard lies in 317 ft of water about 100 km northeast of Aberdeen in the Outer Moray Firth. Oil is exported through an 18-in. pipeline to the Forties Pipeline System for processing at the BP Kinneil plant. Gas from Buzzard will be exported through a 10-in. pipeline on the UK Frigg pipeline to the St Fergus gas terminal.

Dave Thomas, an oil analyst at Citigroup, told OGJ that the $2.9 billion invested to develop the field was "very competitive" bearing in mind rising industry costs. "However, there is still the question on how BG Group will deal with handling high sulfur levels in Buzzard oil," he added. Installing an amine unit offshore to strip sulfur from the oil could cost an additional estimated $200-300 million.

A BG Group spokesman told OGJ that the sulfur was contained in some parts of the reservoir and production would go ahead as planned. "We will look at the H2S in the future," he said.

Alistair Darling, UK Secretary of State for Trade and Industry said: "We know there are still between 15 and 20 billion bbl remaining in the North Sea, and with Buzzard, the UK should return to being a net exporter over the next couple of years."

Buzzard development partners are BG Group 21.73307%, Nexen Buzzard 43.21254%, Petro-Canada UK Ltd. 29.89122%, and Edinburgh Oil & Gas Ltd. 5.16317%.

Contact Uchenna Izundu at uchennai@pennwell.com.

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