Year to end with $2.25 billion more investment in UK offshore

The UK's energy minister expects to end 2001 by giving formal approval to offshore oil projects and capital spending worth more than $2.25 billion. He said 3 projects signed off in the last 2 weeks could secure more than 2,000 jobs in the industry.

By the OGJ Online Staff

LONDON, Dec. 3 --UK Energy Minister Brian Wilson expects to end 2001 by giving formal approval to offshore oil projects and capital spending worth more than $2.25 billion during November and December, he told representatives from the UK offshore contracting community.

He said that 3projects that he has signed off in the last 2 weeks could secure more than 2,000 jobs in the industry.

The latest project to be formally approved by his department is the first phase of the BP PLC-operated Clair project.

Clair field, 75 km west of the Shetland Isles in waters of up to 150 m, is the largest discovered, undeveloped UK continental shelf resource.

Wilson signed the documents for Clair during his meeting in Aberdeen with contractors. He said, "This demonstrates that there is a lot of potential left in the UK offshore industry, based on innovation and technology. In years to come, this first phase of development will supply almost 300 million bbl, making it the largest development since the Elgin-Franklin project, approved in April 1997. Dependent on Phase 1 results, further development of remaining field areas could follow. It will also create another link between the West of Shetlands and East of Shetlands areas."

Wilson said the combined capital investment of developments over the last 8 weeks, including Clair, amounted to an investment of $2.2 billion, and said that by the yearend further work would be approved, which could take the total to $2.25 billion.

Clair was discovered in 1977. Between then and 1990, 10 appraisal wells were drilled, followed by a further 5 appraisal wells between 1990 and 1995. A 3D seismic survey was also carried out during this period, and a further 2 appraisal wells were drilled in 1997 and an extended well test conducted.

BP is operator with 29%, ConocoPhillips Corp. has 24%, ChevronTexaco Corp. 20%, Enterprise Oil Ltd. 18%, and Amerada Hess Corp. 9%.

Clair Phase 1 will focus on the Graben and Horst segments in the southern area of the field. These have estimated reserves of 1.75 billion bbl, of which 287 million bbl may be recovered over a 24-year period. Dependent on the success of Phase 1, further phases might follow, eventually yielding an additional 400 million bbl.

The platform jacket for Clair will be set over an existing well. The jacket is a four-legged, single steel structure 165 m tall. Both jacket and topsides are designed for fabrication, transportation, and installation as a single, fully integrated 10,500 tonne lift that will require access to the heaviest lift capability presently available.

The partners planned to drill 15 producing wells, 8 water injectors, and 1 drill cuttings reinjection well. Produced gas from the Clair project will be either exported to the Magnus Enhanced Oil Recovery western gas pipeline or reinjected into the reservoir.

The other projects referred to by the energy minister include the Juno gas field development in the southern sector of the North Sea and the Scoter subsea satellite program, which he also approved while in Aberdeen.

The previously approved Juno project JUNO forms Phase 2 of the Easington Catchment Area (ECA) development (OGJ Online, Nov. 15, 2001).

The fields to be developed are Apollo and Minerva (BG Group PLC operated) and Whittle and Wollaston (BP PLC operated) in the Southern North Sea off Humberside. Reserves are more than 11 billion cu m of gas and cost would be $400 million.

The $115 million Scoter project makes use of latest-generation technology to recover difficult reserves. Gas and condensate will flow via pipelines to the Shearwater platform 150 miles northeast of Aberdeen, and gas will be processed and exported via the existing SEAL pipeline to the Shell Expro Bacton Gas Terminal.

Scoter has reserves of 200 bcf of gas and 6.5 million bbl of condensate. Development will be through two wells, with the option to drill a third well later.

Drilling, testing, and installation of the wellheads for the first two Scoter wells is scheduled in the second half of 2002.

Shell UK Exploration & Production is operator with 44%, Esso Exploration & Production UK Ltd. has 44%, and as Scoter straddles the boundary between the BP PLC operated Block 23/26b and the Shell-ExxonMobil Block 22/30a, BP has a 12% share.

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