Kerr-McGee Corp., Oklahoma City, Okla., said it has approved a development plan that involves a floating production, storage, and offloading facility for the Leadon field, and satellite fields Birse and Glassel, in the UK North Sea. The plan is subject to environmental review and approval by the UK Department of Trade and Industry.
The three fields will be developed using subsea horizontal wells tied back to the FPSO. Kerr-McGee agreed to acquire the Mitsui F-601, for use as the floater hull, from Mitsui Engineering & Shipbuilding Co. Ltd., Tokyo. Swan Hunter (Tyneside) Ltd. will construct the topsides in Northeast England, and Brown & Root Energy Services Ltd. will provide detailed engineering. The FPSO will be called the Kerr-McGee Global Producer III.
As operator, the oil company said further "major" contracts for the three field development�estimated to cost $600-700 million�would be awarded "over the coming months, involving Scotland, UK, and internationally based companies."
The "Greater Leadon" area encompasses Blocks 9/14a and 9/14b, in which Kerr-McGee holds 100% interest. The company said it estimates the area holds 120-170 million boe; the original estimate was 70-100 million boe (OGJ, Feb 14, 2000, p. 32). The Leadon field is 15 miles north of Kerr-McGee's Gryphon field.
The company expects initial production from the Greater Leadon area in early 2002, with peak production projected at approximately 50,000 b/d of oil by yearend 2002.
"We believe an FPSO is the most efficient, cost-effective, and reliable method of development for the Greater Leadon area," said Luke R. Corbett, Kerr-McGee chairman and chief executive officer. "The expertise gained in design, installation, and operations of our Gryphon FPSO has been invaluable to the development plans for the Leadon area.
He added that the company would be "drilling additional exploratory prospects surrounding the Greater Leadon area [to] further enhance the value of the development."
"Our strategy to build core operating areas has proven successful, and we remain committed to further expansion of our operations in the North Sea," Corbett said.