From the North Sea (NT): It’s too early to know if the new tax arrangements offered by the UK government will revitalise the offshore sector here, but that it needs a lift is beyond doubt, despite near record investments of some £13bn.
If the industry’s life-blood is the flow of reserves from discovery through to development and production, the patient is in a semi-comatose state, showing only muted signs of life.
In 2014 only eight fields were approved for development: Chevron’s Alder (SEN, 31/5); Apache’s Aviat (31/16); Premier’s Catcher (31/13) area including Burgman and Varadero; Maersk’s Flyndre-Cawdor (31/14), another joint development; and EnQuest’s Ythan (31/14).
With the exception of Catcher, which has combined reserves of 96mmboe, all are pretty small beer. For the second year running, the 25 incremental projects receiving the official go-ahead far outstripped new developments.
As regards new field start-ups, BP achieved first oil from Kinnoull (see page 5), just as 2014 was about to expire, but this made little difference to another unimpressive performance, which saw a grand total of four fields come onstream in 2014.
Nexen’s Golden Eagle (31/17), with reserves of 140mmbbl, was easily the biggest. Two small gas fields, GDF Suez’ Juliet (30/24) and Centrica’s Kew (29/11), bringing up the rear and Kinnoull (45mmboe), in the middle.
Several other fields were expected onstream last year but didn’t, for one reason or another, make it. These include ConocoPhillips’ Enochdhu (30/13); Talisman’s Godwin (28/8); Total’s Laggan-Tormore (31/12); and Premier’s Solan (31/13).
Various other fields are approaching start-up, which should make this year a substantial improvement on 2014: EnQuest’s Alma/Galia redevelopment (31/11); Ithaca’s Greater Stella Area (31/13); and GDF’s 18bcm Cygnus (29/20) gas field.
Drilling woes
Full figures are not yet available on exploration. Wildcat drilling appears to have recovered from a disastrous 2013 with 13 new spuds in the first nine months against 14 in the whole of the previous year. However, appraisal drilling fell back, with only 11 spuds to end September against 28 in all 2013.
The results may also have been somewhat better than the previous year. Discoveries were made at EnQuest’s Avalon; GDF/BP’s Marconi/Vorlich (31/16); Centrica’s Pegasus and GDF’s Romeo.
There were encouraging appraisals at Hurricane’s Lancaster (30/22) and Clair (30/2) where BP has hinted that a new processing centre may be needed.
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