JUST recently, the UK Government announced that a wide range of companies had applied for 356 blocks in the UKCS 26th Round, the largest number of block applications since the 1st Round in 1964.
Conditional awards will be announced later in the year, prior to which an applicant listing may be published, throwing light on potential new entrants to the sector.
We calculate that 34 firm commitments remain outstanding on acreage awarded in the 21st to 25th Rounds that, if drilled, would target an estimated resource potential close to 750million barrels oil equivalent.
The award of 26th Round acreage will add to both the pool of commitment wells and the targeted resource. Meanwhile, mid-year UK drilling statistics show greater activity than 2009, with 23 wells (13 exploration and 10 appraisal) and five sidetracks having started offshore.
Currently, 10 E&A wells are active, employing four semi-submersible and six jack-up rigs. Apart from 2008, which was exceptional by any standard, the year to date is experiencing the highest level of E&A drilling in the sector for five years.
Development activity is also holding up, with 64 development or production wells started this year, including 35 spuds and 29 sidetracks. Currently, 20 of these wells are active, utilising nine platform rigs, eight semis and three jack-ups.
One E&A-class well is active in the Northern North Sea – Valiant’s Tybalt 211/8c-4Z probe, where the Ocean Nomad is currently testing in a sidetrack of the discovery.
West of Shetland, Hurricane has re-entered and sidetracked its Lancaster discovery, 205/21a-4, to conduct a drill-stem test (DST).
Four wells are active in the Central North Sea. Maersk’s 15/20b-18 on the Dunglass Prospect spudded in June using the semi-submersible, Noble Ton van Langeveld. The GSF Arctic IV semi remains on Nexen’s Blackbird appraisal, 20/2a-9.
EnCore is expanding its programme on the Catcher discovery, 28/9-1, with the Galaxy II jack-up, to include a further appraisal sidetrack. And GDF Suez has spudded 22/25a-10 with jack-up Ensco 101, the first appraisal of the high-pressure/high-temperature (HPHT) Culzean discovery.
The Southern North Sea also has four rigs, all jack-ups, on E&A duties. The Ensco 100 is on the GDF Suez Cygnus appraisal, 44/12a-5; Noble Julie Robertson spudded (then re-spudded) the York pre-development well 47/3a-15; Noble Byron Welliver remains on ATP’s Kilmar appraisal 43/22a-3 pending a sidetrack, and the Ensco 72 spudded RWE’s Macanta prospect well, 42/14-2, following abandonment of 42/19-1 on the Airidh prospect as a dry hole. Dana’s Monkwell appraisal, 42/29a-10, also disappointed.
We’re effectively halfway through the year and the exploration technical hit rate is one-in-three.
Oil discoveries have so far been announced by Valiant at Tybalt (East and West) in the northern sector and by EnCore at Catcher in the Central North Sea, possibly the largest find in the sector since Buzzard.
Gas discoveries in the Southern North Sea have been made by Dana at Platypus and by Centrica at Olympus.
Although Dana’s appraisal programme has deemed Monkwell sub-commercial, progress has been made in appraisal of TAQA’s Tern North oilfield in the NNS, Ithaca’s Stella discovery in the CNS and GDF Suez’s Cygnus gas field in the SNS.
Despite the continuing reluctance of the banks to fund, the mood in the sector is one of optimism.
Simon Robertshaw’s column is courtesy of North Sea drilling analysts Hannon Westwood