Horizontal drilling and an expansion of water injection capacity will improve Denmark's production prospects during the next few years.
Crude oil production has been running at 110,000-120,000 b/d, with gas output averaging about 225 MMcfd.
Dansk Undergrunds Consortium (DUC)-involving A.P. Moller, Royal Dutch/Shell Group, and Texaco Inc.-feels confident enough about prospects to request an upgrading of capacity in the pipeline that moves oil and condensate to the Frederica terminal on the Danish mainland.
State-owned Danish Oil & Natural Gas (DONG), which owns and operates the pipeline, will increase capacity to 160,000 b/d from 130,000 b/d within 2 years.
DUC says its plans will ensure that the pipeline operates near its increased capacity during the winter, when gas and liquids production rates peak.
The consortium plans to spend 10-15 billion kroner ($1.58-2.38 billion) on further offshore development the rest of the decade.
DUC has become one of the largest employers of horizontal drilling in the North Sea. Horizontal wells have proved ideal for the shallow horizons found in Danish waters.
In Dan oil field, oldest of DUC's producing structures, six horizontal wells have helped to maintain production at 27,000-28,000 b/d, far in excess of estimates of early 1990s production made before the horizontal wells were planned.
During 1990 and 1991, DUC will drill another seven horizontal wells in Dan field at a cost of 800 million kroner ($126.9 million), which will maintain output in the 25,000-30,000 b/d range during the next 2-3 years.
The Maersk Endeavour jack up has completed the first of the horizontal wells and has started on the second well in the program.
Denmark's biggest oil producer is Skjold field, which has been averaging about 40,000 b/d the past 12 months. DUC is drilling two wells, one injector and one producer, which are expected to raise overall production to about 50,000 b/d during 1990. Boosting output to these levels will require additional processing capacity. DUC estimates the cost of drilling and new platform facilities at 470 million kroner ($74.6 million).
GORM WATER INJECTION
The other major program under way is the second phase of water injection at Gorm field.
DUC will spend 160 million kroner ($25.4 million) on two or three additional injector wells and one sidetrack to supplement the three injectors and two producers drilled in the first phase of the project.
It also will install a new platform to house the 120,000 b/d water injection equipment serving Gorm and nearby Skjold field, where the Maersk Explorer jack up is injecting about 75,000 b/d on a temporary basis.
The jacket and topsides are under construction in Netherlands and will be installed early in 1991. Start-up is scheduled for next summer.
The new unit, known as Gorm F, will also contain processing equipment to handle output from Dagmar field, the first reservoir in Danish waters with hydrogen sulfide. The Gorm F platform and other facilities on Dagmar will cost a total of 1 billion kroner ($158 million).
DUC said Dagmar will be developed in phases with subsequent expenditure after the 1990 program, depending on reservoir performance.
Initial plans call for installation of the first unmanned satellite Star platform, which will have capacity for six wells. However, in the first phase only two wells will be drilled.
The second Star platform will be installed in Kraka field, which has poor reservoir properties and would not be economic without the two planned horizontal wells.
The Star platform will be in place before the end of the year.
DUC expects to begin production next year at a cost of 450 million kroner ($71.4 million).
One of the most challenging projects is Valdemar field, which covers a large area but has very thin sands.
The first two horizontal wells in the initial development stage have been disappointing. DUC suspended operations to gather more seismic data and further review the reservoir.
It said work will resume shortly. The first two development phases, including the Star platform, four horizontal wells, and a pipeline link to the Tyra West production complex, will cost 950 million kroner ($150.7 million).
Horizontal drilling is also starting in Tyra West field, which is principally a gas field with relatively high condensate levels. A thin oil layer underlies the gas reservoir, and DUC has scheduled two horizontal wells in the thickest part of the zone in the southwestern part of the field.
The project will cost about 13 million kroner ($22 million) and will add about 15 million bbl to the 90 million bbl of liquids that DUC previously estimated would be recoverable.
CONTRACT FLEXIBLE
Future development projects will depend on demand for gas from the state-owned gas company Dangas. A new supply contract allows DUC considerable flexibility in meeting future demand.
Two fields have been earmarked to meet future increased demand under the new contract. Roar field will probably come onstream in fall 1993 through an unmanned wellhead platform tied back to Gorm field through 10.5 mile gas and liquids lines.
Harald field, covering the Lulu and West Lulu structures, has reserves of 900 bcf of gas and 50 million bbl of liquids and will probably not be needed until 1998. However, start-up could be brought forward if Dangas needs earlier supplies.
Harald will be able to support 200 MMcfd of gas production through a 50 mile pipeline into the Tyra riser platform. Liquids will be piped to Gorm field.
The pipeline links and processing facilities will provide infrastructure for other development projects in the northern part of the Danish North Sea. North Arne field is scheduled to be developed as a satellite of Harald, coming on stream about 2 years after the main field.
Also scheduled for start-up toward the end of the century, probably in 1999, is the Adda structure, which might be developed as a satellite of Tyra field.
DUC's most intriguing future project is Gert field, which straddles the median line with Norway. Norsk Hydro has appraised the field on the Norwegian side, and DUC has started an appraisal program in Danish waters.
The structure might extend outside DUC retained acreage, which started a prolonged dispute with the government over title to adjoining Block 5603/28.
The dispute ended with award of the acreage to DUC in a licensing allocation outside normal rounds on the condition that DONG receive a 20% carried interest and that an 8.5% royalty be paid on any future production from the Jurassic prospect.
Early estimates divide the projected 120 million bbl of reserves between Denmark and Norway on a 60-40 basis. DUC and Norsk Hydro have been exchanging information, but no formal unitization discussions have taken place ahead of new appraisal drilling by the Danish concession holders.
A decision to go ahead would pose an interesting transportation question. The nearest pipeline link into existing infrastructure would be through the Valhall-Ekofisk complex in Norwegian waters.
Harald field would be the nearest Danish link, but Gert could well be presented for development ahead of this project.
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