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3 successful offshore brownfield developments

Lifecycle stage
Production

UK – THISTLE FIELD

EnQuest in early 2013 was among one of the first oil and gas operators to secure a brownfield tax allowance marking the next phase of investment in the Thistle Late Life Extension programme in the North Sea.

As production was declining and infrastructure ageing, EnQuest in 2010 acquired Thistle and embarked on an upgrade of facilities, safety system and a major rig reactivation application.

This included drilling 5 new wells which have since significantly improved production as the rig continues to tap into the 35 million boe of reserves below.

A critical element of the project saw a 30MW power generating turbine attached to the rig, providing increased reliability and uptime in the long term. Now the onboard team are looking to lower costs further by operating the turbine on fuel rather than diesel delivered by a ship and removing the old generators.

This project is a great example of how tax allowances are fuelling North Sea developments and innovations.

UK – NINIAN FIELD

CNR International committed to investing £300 million to extend the life of one of the oldest fields in the North Sea in 2013.

The reinvigorated Ninian Field, which is expected to create jobs and bolster the field’s economic life, will see four new production wells drilled and upgrades to two existing wells.

This will enable an incremental 27 million barrels of oil produced from the investment.

Speaking at the time about the news, CNR’s Managing Director James Edens said, “Ninian is a further example of how we are able to recover more oil from mature assets through a combination of innovative ways of working and technical expertise.”

Ninian was another field, just like Thistle, that benefited from government intervention in the form of the Brownfield Tax Allowance.

IRAQ – MAJNOON FIELD

Shell has announced that the Majnoon oilfield it operates in partnership with South Oil Company (SOC), Petronas and Missan Oil in Southern Iraq has successfully exported its first shipment of crude oil.

The achievement comes as production at the Majnoon oilfield has reached a current average of 210,000 barrels of oil per day, well in excess of the 175,000 barrels per day (bpd) First Commercial Production target. This initiates the commencement of cost recovery and was achieved after extensive rehabilitation works at the oilfield.

Shell and its partners successfully recommenced production from Majnoon in September 2013 following the completion of major overhaul works, including 28 square kilometres of mine clearance, extensive refurbishment of brownfield facilities to meet safety standards, and the construction of a new greenfield central processing facility – the largest to be built in Iraq in the last decade.

This allowed for increased production capacity. To date, 18 new wells have been drilled, while the project has created more than 2,850 jobs for Iraqi’s from the neighbouring communities.

BROWNFIELDS THE FUTURE?

As the cost of wages, rig rates and projects increase, the pressure to find new discoveries intensifies.

Projects above in the UK and Iraq have proven that with consideration and investment the benefits of targeting new brownfield developments can be lucrative.

Underexplored areas in the North Sea where discoveries are a greater distance from pipeline infrastructure could be advantageous, but with a high upfront cost, operators in the North Sea will need to swallow the investment initially to secure a long term successful site.

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