Pair are behind ‘world class projects’ in basin

North Sea: Praise for BP, Hurricane

BP and Hurricane Energy are leading the way when it comes to showing the potential of the west of Shetland basin, an analyst has said.

Oil major BP has “world class projects” in Quad 204 and Clair Ridge, while Hurricane is making progress with its Lancaster field early production system, said John Corr, north-west Europe consulting manager at Westwood Global.

He also highlighted new money coming into the area, with private-equitybased Siccar Point Energy going after oil from the Cambo and Lyon prospects in 2018.

Output in the region will ramp up between 2018 and 2020 before plateau and decline set in, Westwood predicted.

But innovative technological solutions will be required to offset expected decreases.

Operators will also have to target new plays and develop fields in clusters to arrest the eventual slide, Mr Corr said. When it comes to exploration performance, however, the area has performed poorly in comparison with other parts of the UK North Sea, he added.

Since 2008, there have been just four commercial discoveries from 23 programmes – a commercial success rate of just 17%.

Finding costs are the highest in the UK continental shelf at $14 per barrel and although the average discovery size is bigger than elsewhere, it does not compensate for the costs involved, Mr Corr said.

There is much to play for west of Shetland, with 2.4billion barrels of oil thought to be contained in undeveloped discoveries, but developing oilfields there is a huge challenge.

Mr Corr said: “Infrastructure access to pre-existing facilities is difficult to achieve.

“Most of the oil facilities are either full or incapable of handling any more water.

“Any future gas development would be required to piggyback into the Laggan/ Tormore flowlines, a technically challenging prospect, or build a dedicated line to the Shetland Gas Plant, a commercially fraught venture.

“The region has some of the harshest deepwater conditions, which makes developments commercially challenging.

“Westwood has examined the economics of tieback developments for a variety of resource types and sizes. The conclusion is that at current price assumptions of $60 per barrel, 50million barrels is required for a project to break even for oil in shallow water.

“This increases to 150million for deepwater projects, off the continental shelf.”

– Landings yesterday from six boats and three consignments totalled 5,205 boxes. Cod large £1.70-£2.60, medium £1.80-£2.30, selected £1.80-£2.20, small £2-£2.50; haddock large £1.50-£2, medium £1.50-£2, selected £1.50-£2.50, seed £1.25-£2.50, chippers 90p-£2.40, metros 50p-£1.20, round 30p; whiting 90p-£2, round 65p-£1.20; lemon sole £5-£10; monks large, medium and selected £3.40-£3.90; coley large £1-£1.10, medium £1-£1.30, selected £1-£1.15, small 90p-£1; megrim 50p-£4.50; plaice 80p-£2.20; hake £1.80-£4; witches 40p-£1.60; ling £1.50-£2.30; squid £1-£6; coley extra small 70p-75p (kg).

Boats – Our Lass III, Consortium, Boy Andrew, Lapwing, Budding Rose and Favonius. Consigned – Opportunus, Atlantic Challenge and Berly.

“50million barrels is required for a project to break even for oil”

MAJOR DEVELOPMENT: BP’s work in Quad 204 has been praised