Wood Mackenzie: 50 U.K. finds earmarked for development

U.K. offshore likely developments [86369 bytes] Fifty offshore discoveries are likely to be approved for development by the U.K. government in the next few years, requiring a total capital outlay of £ 7.2 billion ($10.8 billion). This is the view of Wood Mackenzie Consultants Ltd., Edinburgh, which noted that since this time last year, 19 U.K. fields have received development approval but only nine new prospects have been brought forward.

Nov. 11, 1996

2 min read

U.K. offshore likely developments [86369 bytes]

Fifty offshore discoveries are likely to be approved for development by the U.K. government in the next few years, requiring a total capital outlay of £ 7.2 billion ($10.8 billion).

This is the view of Wood Mackenzie Consultants Ltd., Edinburgh, which noted that since this time last year, 19 U.K. fields have received development approval but only nine new prospects have been brought forward.

New to the analyst's likely field developments listing are 9/19 Area North, Bedevere, Gannet E&F, Katrine, Mariner, Mordred, Ross, Thames Northwest and Wendy discoveries (table).

After Wood Mackenzie published its list, Shell U.K. Exploration & Production received government approval to develop Gannet E&F prospects as subsea satellites of Gannet platform.

Subsea development proves to be the most popular option among the prospects, said Wood Mackenzie, with 21 of the total likely to be produced this way.

"In total," said Wood Mackenzie, "some 1.8 billion bbl of liquids and 7.7 tcf of gas are estimated to be recoverable from the probable fields portfolio, representing about 18% of the U.K.'s remaining commercial reserves."

The fields are expected to yield a peak of about 600,000 b/d of liquids by 2001, providing about 25% of U.K. total output expected at the time.

"If our estimates of time scales hold for probable developments," said Wood Mackenzie, "their total contribution of an average of around 340,000 b/d of liquids in 1998 and 1999 should help maintain U.K.'s second peak in production, estimated to reach 3 million b/d in 1998 and 1999."

Wood Mackenzie reckons capital outlays on the 50 prospects will be £ 2.30/bbl of oil equivalent ($3.45/ BOE), while total development cost will equate to £ 4.85/BOE ($7.28/BOE).

"This compares with a current development cost for fields under development of £ 5.23/BOE," said Wood Mackenzie. "This differential emphasizes the incremental nature of these future developments as well as progress in cost reduction initiatives."