Redeveloped Schiehallion oil field gives shot in arm to BP and partners
● Latest project means life of North Sea field will be extended to 2035 and beyond
The first oil from a redeveloped field has been unlocked following the completion of the multi-billion-pound project west of Shetland, it has been revealed.
Schiehallion and the adjacent Loyal fields were first developed in the mid-1990s and have produced nearly 400 million barrels of oil since production started in 1998. After reintroducing the Schiehallion field through the Quad 204 project, BP and co-venturers Shell and Siccar Point Energy said they expected it to retrieve an estimated 450 million barrels of oil, which will extend the life of the field to 2035 and beyond.
BP group chief executive Bob Dudley said yesterday: “The start of production from Quad 204, one of the largest recent investments in the UK, is an important milestone for BP, marking a return to growth for our North Sea business.
“As one of the series of important, higher-margin major projects that are now steadily coming on line for BP, it also underpins our expectation for growing production and cash flows from our upstream business over the coming few years.”
Production will increase through the remainder of this year to plateau at a level of 130,000 barrels of oil per day.
BP hopes to increase its UK North Sea production to 200,000 barrels of oil a day by 2020 and sustain business in the region for several decades.
In addition, production from the new Clair Ridge project is expected to begin next year. Over the next 18 months, the oil firm’s plans involve up to five exploration wells in the UK and drilling 50 development wells over the next three to four years.
Mark Thomas, regional president for BP’S North Sea business, said: “In safely delivering first oil from the Quad 204 project, we have succeeded in one of the largest ever UK midlife offshore redevelopments.
“BP has developed a strong track record of finding, developing and operating big offshore oil resources west of Shetland – we have and will continue to use the latest technology to maximise recovery from the Schiehallion area.”
Deirdre Michie, chief executive of industry trade body Oil & Gas UK, said hailed the development as “excellent” news, and another “positive endorsement” of the potential of the UK Continental Shelf with the right investment.
Michie said it was “extremely heartening to see one of the original explorers of the basin using new, ambitious approaches and pioneering technology to help lead a revival in production”, and that it was a welcome boost for hard-pressed supply chains.