NORTH SEA OIL FLOW UP; DRILLING ACTIVITY DOWN

North Sea oil production passed 5 million b/d for the first time last November, breaking a record set only the month before.

The new mark stands at 5.08 million b/d, up from October's 4.94 million b/d.

Meantime, a number of new fields off the U.K. went on stream late last year, assuring a hefty volume of oil production as 1994 got under way.

North Sea operators achieved their record production volumes despite a slide in drilling activity. Drilling for the first 9 months of 1993 was down 14% from the same period of 1992.

Mackay Consultants, Inverness, Scotland; reported the decline was almost entirely due to a drop in exploration (Table 1). While development drilling was stable, exploration and appraisal drilling was cut 28.5%.

PRODUCTION BREAKOUT

Once again Norway and Denmark set production records last November. Wood Mackenzie Consultants Ltd., Edinburgh, reported Norwegian oil and NGL production for the month averaged 2.63 million b/d, while Denmark averaged 185,000 b/d.

Those figures compared with last October's record levels of 2.56 million b/d and 177,000 b/d, respectively (OGJ, Dec. 20, 1993, p. 33).

Wood Mackenzie said the increase was largely due to rising production from Norway's Brage, Draugen, and East Sleipner fields. Gullfaks field also reached a new peak of 550,000 b/d.

Increased Danish production was credited to a buildup in volume from Regnar and Valdemar fields.

Netherlands' offshore oil production rose to an average 39,000 b/d for November, compared with 31,000 b/d in October. This was said to be due to F/3 FB and Horizon fields continuing to come on stream.

U.K. oil production averaged 2.29 million b/d in November compared with 2.25 million b/d in October. The total included 80,000 b/d of onshore production.

NEW U.K. FIELDS

Wood Mackenzie estimated production from Tiffany field, operated by Agip (U.K.) Ltd., at 5,000 b/d since it came on stream in November. Oil flow is expected to reach 65,000 b/d this year.

Tiffany and Toni fields, on U.K. Block 16/17, hold estimated reserves of 65 million bbl of oil, 10 million bbl of NGL, and 120 bcf of gas. Toni is expected to start production in the next couple of months at about 20,000 b/d.

When final figures are in, U.K. production for December is expected to increase from November's figure as Alba field on Block 16/26 began production early in the month, while East Brae and Strathspey fields went on stream toward the end of December.

Marathon Oil U.K. Ltd. began production from Block 16/3a East Brae field Dec. 24 from more than 300 million bbl of liquids and 1.4 tcf of gas reserves (OGJ, Jan. 3, p. 26).

Liquids output from East Brae is expected to peak at 115,000 b/d in November. Natural gas sales will start in October at 270 MMcfd, rising to 350 MMcfd.

Marathon earlier disclosed plans to develop other fields in the Brae area using facilities in the Brae complex (OGJ, Nov. 29, 1993, p. 28).

Texaco Ltd, placed Strathspey field on stream Dec. 26 (OGJ, Jan. 10, p. 32). Gross peak production is expected to be 45,000 b/d of oil and 114 MMcfd of wet gas.

Strathspey field is the latest subsea development brought on stream using Central Ninian platform facilities operated by Chevron U.K. Ltd. Plans for further Ninian satellites were announced recently (OGJ, Dec. 13, 1993, p. 24).

DRILLING DECLINE

Mackay blamed the drop in North Sea drilling on low oil prices, increasing attractiveness of other oil provinces, and maturity of the North Sea arena.

The analyst said drilling activity during the last 3 months of 1993 will not change this picture significantly.

Although North Sea exploration drilling will continue to decline, Mackay said, 1993 was atypical and future annual declines will be much less severe.

While drilling was down, North Sea oil production is predicted to increase by 10.5% for 1993 compared with 1992 and to rise another 13% in 1994.

Gas production also is predicted to rise, by 6% from 1992 to 1993 and 8.5% from 1993 to 1994 (Table 2).

Total North Sea spending on exploration, development and production is predicted to be $29.1 billion in 1993 and $28.7 billion in 1994, both down from the $30.8 billion spent in 1992. Spending in 1993 is estimated to be split among the U.K. 50.1%, Norway 38.4%, Netherlands 7.6%, Denmark 3.3%, Ireland 0.6%, and Germany 0.1%.

Mackay said the U.K. will again account for most activity in 1994, but the importance of the Norwegian sector has been growing steadily and will continue to do so.