The Phillips Petroleum Co. Norway group has submitted to Oslo two alternative plans for redevelopment of Ekofisk oil and gas field in the Norwegian North Sea.
In the wake of safety concerns raised in October 1992 by the Norwegian Petroleum Directorate, Phillips is required to install a new processing platform in 1998 to replace the existing processing and tank platform because of seabed subsidence.
Phillips agreed to meet the NPD requirement but proposed last year to submit a more radical alternative plan that would extend field life beyond the 2011 expiration date of the current production license (OGJ, Aug. 30, 1993, p. 47).
The plan for development and operation (PDO) submitted to Norway's Ministry of Industry and Energy at yearend 1993 names the alternative plans Ekofisk II and Ekofisk 2011.
"Both PDO alternatives are viable and would effectively provide compliance with NPD requirements," said Knut Aam, managing director of Phillips Norway.
"We prefer the Ekofisk II alternative, which would extend the field's economic life by reducing operating costs and allow for additional hydrocarbon recovery from existing fields.
"The Ekofisk 11 project would further enhance safety and environmental standards, mitigate the effects of field subsidence, and increase the value of Ekofisk."
EKOFISK II
Phillips estimated the cost of new facilities under Ekofisk II at 20 28 billion kroner ($3 4 billion). Engineering and design studies are to be carried out during the next 6 9 months to determine a more precise cost figure.
The plan requires Phillips to install new processing and transportation facilities outside the area of subsidence, new wellhead platforms built to withstand future subsidence, new accommodation facilities, and a new riser platform.
Aam set out four conditions for Norwegian authorities to agree to if Ekofisk II is to be viable:
- Production and transportation licenses should be extended to match a revised economic life span of the field, presently expected to end in 2031.
- Future oil and NGL production should be exempt from 10% royalty as if this were a new development.
- A commercial and financing plan should be approved that creates three new partnerships to handle transportation and processing facilities.
- Removal of existing facilities should be deferred until after 2011.
"None of the companies in the Phillips Norway group are willing to invest this much in facilities to be completed by 1998 without any assurance of continued operations after the end of the present license period," Aam said.
EKOFISK 2011
The Ekofisk 2011 alternative is a medium term plan said by Phillips to provide safe, effective operations within the current Ekofisk license period, which ends in August 2011.
A new oil and gas processing platform would be placed near the current tank platform, installed in 1975 on Block 2/4, to handle the tank's processing functions. Existing production platforms would receive limited upgrades.
Phillips estimated costs for the Ekofisk 2011 option at 14 21 billion kroner ($2 3 billion).
"We are prepared to implement this alternative if the long term concept is not accepted," said Aam.
Phillips said the PDO likely will be discussed by Norway's Storting (parliament) during the spring to meet the planned 1998 start up.
Ekofisk currently sends 560,000 b/d of oil by pipeline to Teesside, U.K., and 2 bcfd of gas by pipeline to Emden, Germany.
Ekofisk partners are Phillips 36.96%, Fina Exploration Norway Inc. 30%, Norsk Agip AS 13.04%, Elf Petroleum Norge AS 7.594%, Norsk Hydro AS 6.7%, Total Norge AS 3.547%, Den norske stats oljeselskap AS 1%, Elf Rex Norge AS 0.855%, and Norminol AS 0.304%.
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