Uchenna Izundu
International Editor
LONDON, Dec. 17 -- Operators on the UK Continental Shelf are expected to drill at least 210 wells by 2010, according to a report by UK North Sea consultancy Hannon Westwood LLP, Glasgow.
A total investment of $500 billion will be required to maximize the UKCS's potential of 24 billion boe over the next 40 years. About $1 billion/year should be spent over the next 4 years to develop 83 exploration prospects with short, medium, and long-term farm-in investment. The consultancy forecasts 50 exploration and appraisal wells will be drilled on the UKCS each year.
However, operators are turning away from the gas basin on the UKCS because of low gas prices and high equipment costs. Instead gas-prone companies are moving into oil projects, particularly in the Central North Sea.
The report said, "The majority of the 83 wells expected to be partially or fully offered for farm-in funding–mostly in the Central North Sea–are mainly offered by independents that are seeking to fully fund their portfolio of proposed wells." There are 26 prospects on promote or frontier licenses up for farm-in opportunities. In contrast, the number of projects available in the southern North Sea for farm-in have fallen since July 2007.
Chris Bulley, executive director of Hannon Westwood, said: "Since we first started reporting on farm-in opportunities, the Central North Sea has consistently delivered the most farm-in opportunities, signaling a continued drift towards an oil province and despite the continued uncertainty over gas prices a continuation in HPHT drilling. This perhaps reflects as well a greater number of Promote licensees in the Central North Sea and also the amount of near-field drilling in the gas basin by stable long-term groups."
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