Curlew project tops U.K. North Sea action

Curlew Field Development Layout [45364 bytes]

Shell U.K. Exploration & Production has received U.K. Department of Trade & Industry approval for a £300 million ($450 million) fast-track development of Curlew oil and gas fields in the U.K. North Sea.

In other U.K. North Sea action, Amerada Hess Ltd. has disclosed minimal details of an oil strike but appears confident it has a viable development prospect.

Meanwhile, big changes are ahead for operations in one of the North Sea's most prolific oil fields, the aging giant Ninian, which is to change hands following a $140 million deal between Chevron U.K. Ltd. and a combine of Oryx Energy Co. and Ranger Oil (U.K.) Ltd. (OGJ, Aug. 5, p. 24).

Curlew project

Shell Expro, operating joint venture of Shell U.K. Ltd. and Esso Exploration & Production U.K. Ltd., said development will involve conversion of a tanker into a floating production, storage, and offloading (FPSO) vessel.

First production is expected in 18 months. Shell/Esso will lease the floater from Maersk Co. Ltd., London. Maersk will oversee conversion of its 100,000 metric ton Maersk Dorset tanker for the project.

Curlew consists of two accumulations on Block 29/7, one discovered in 1990 and the other in 1994. Shell/Esso estimated combined reserves at 71 million bbl of oil and condensate and 244 bcf of gas.

First production is slated for autumn 1997, with peak output pegged at 45,000 b/d of oil and 100 MMcfd of gas. The ship will have capacity to store 560,00 bbl of oil.

Oil will be exported by shuttle tanker, while gas will be exported via the existing nearby Fulmar pipeline to St. Fergus terminal, north of Aberdeen.

Curlew represents Shell Expro's second FPSO in the Central North Sea. The Anasuria goes into operation at Guillemot and Teal fields later this year.

Anasuria arrived at Tyneside, U.K., earlier this year for fitting of topsides and turret at the AMEC Process & Energy Ltd. yard at Wallsend. It is expected to begin production by yearend (OGJ, Apr. 15, p. 31).

Shell/Esso said the Curlew tanker will be converted by A&P Tyne, then towed to AMEC's yard for installation of topsides built by AMEC. Its turret will be supplied by Single Buoy Moorings Inc. of Marly, Switzerland.

Amerada strike

Amerada's 20/5c-6 new pool wildcat was drilled as a joint venture of license groups for Block 20/5c and Block 14/30b immediately north.

The well tested at a rate of 8,647 b/d of light hydrocarbons through a 2 in. choke and was suspended for future use (OGJ, Aug. 5, p. 25).

An Amerada official said the discovery is interesting enough for further appraisal and plans are being formulated, although it is too early to contemplate development options.

The discovery lies 25 km southwest of Amerada's Ivanhoe/Rob Roy fields, and 12 km northwest of Buchan field, operated by BP Exploration Operating Co. Ltd.

Block 20/5c license partners are operator Amerada 50%, Talisman North Sea Ltd. 20%, Brabant Petroleum Ltd. 15%, and MOC Exploration (U.K.) Ltd. 15%.

Block 14/30b license partners are operator Amerada 44%; Unocal North Sea Exploration Ltd. 11%, Talisman North Sea Ltd. 15%, Monument Resources Ltd. 20%, and British-Borneo North Sea Ltd. 10%.

Chevron sale

Ninian's current operator Chevron U.K. sold its interests in Ninian, Hutton, Lyell, and Murchison fields, and Columba B discovery to Oryx and Ranger.

Oryx is already operator of Hutton, Lyell, and Murchison, and takes 65% of the new assets with Ranger 35%. Completion of the deal, with transfer of Ninian operatorship to Oryx, is expected in September.

Ninian oil production passed the 1 billion bbl mark in 1994 (OGJ, Oct. 10, 1994, p. 90). At the beginning of this year Ninian had estimated remaining reserves of 50 million bbl of oil.

Oryx expects 11 years further production from Ninian, which currently yields about 55,000 b/d of oil. Ninian facilities are also used to produce two subsea satellites, Lyell and Strathspey, and Columba D reservoir through an extended reach well from Ninian South platform.

Oryx took over operatorship of Hutton, Lyell, and Murchison from Conoco (U.K.) Ltd. in January 1995 and expects to have reduced operating costs by 15%, or more than $1/bbl, by yearend.

On Hutton and Murchison Oryx cut manning levels, introduced 'multi-skilling,' increased use of contractors, and reorganized operations. The company plans a similar squeeze in Ninian.

Ninian rationalization

Ninian currently has 176 staff working offshore and 116 onshore. Chevron said it expects the deal will lead to redundancies beginning November, although a significant number of employees are likely to be offered positions with Oryx or its operations contractor.

Chevron was already planning a round of staff reductions and operational changes in Ninian in a bid to reduce operating costs and extend field life. A Chevron official said, "The decision to sell was not related to this program. The sale deal popped out of left field as we were working to reach our cost objectives.

"Ninian represents only 10% of our total U.K. producing assets value but was consuming more than 10% of our total operating costs. We had two options to extend Ninian field life: reduce manning and costs or sell."

Chevron's interests in the fields involved are currently Murchison 25.93%, Hutton 22.17%, Lyell 33.33%, Ninian 23.63%, and Columba B 17.6%.

Following the sale, Oryx will own 44.9% of Ninian, 58.75% of Hutton, 88.33% of Lyell, 68.71% of Murchison, and 52.54% of Columba B.

The deal will give Ranger a 24.09% stake in Ninian, 21.46% in Columba B, 7.76% in Hutton, 11.67% in Lyell, and 9.08% in Murchison.