A drive towards exploiting the millions of barrels of oil in the North Sea’s small oil pools could lead the UK’s subsea sector to become world leaders in exploiting hard to recover oil supplies and sustain the industry for decades to come, according to a senior industry figure.
Dr Gordon Drummond, project director of National Subsea Research Initiative (NSRI) told Energy Voice that Government support for test project targeting remote small pool deposits could provide practical help to the industry and demonstrate the effectiveness of the technology and innovation required to maximise economic recovery (MER) on the United Kingdom continental shelf and beyond.
Small pools have been defined as stranded, discovered oil or gas fields within the UKCS containing less that 15 million barrels of oil equivalent.
At present there are 210 pools identified in the UKCS – believed to contain between 1-1.5billion barrels of oil equivalent.
To develop this quantity of fields a potential $19billion in capital and $16billion in opex would be needed with billions in revenues to the Exchequer.
“At present the return is zero unless these pools can be opened up and developed,” said Drummond.
“There is an opportunity for the UK subsea sector to lead the way in developing the technology that can maximise the recovery. This technology then can be exported to other regions of the world where the pools are much bigger. It is a tremendous opportunity.”
“Leadership must be exhibited. This is where the Government, via the OGA, can act as a catalyst to small pools development.”
The Government regulator – the Oil and Gas Authority – is working on mapping the location of the UK’s small pools and should have the results of this in coming months.
Mapped pools will allow the industry to understand what kind of technologies are required to access reserves. This could include existing infrastructure such as a pipeline or a topsides host facility, but also new technology needed to access the more remote pools.
Drummond said: “Construction of the map opens both the technical and commercial conversations to the demand side of the equation.
“It will identify who owns the pools, who own the adjacent infrastructure and the barriers preventing development.
To overcome such a challenge, apart from being a considerable achievement in its own right, will assist greatly with achieving Maximising Economic Recovery and increasing the longevity of what is reported as a sunset industry.
Solving small pools would perhaps yield a reward potentially greater than that described here with regards to the domestic market. It would enable the already capable UK supply chain to export its knowledge, products and services to the international markets, thus safeguarding jobs, revenue and therefore tax beyond the inevitable demise of UK resources.
Drummond said the proposed Oil and Gas Technology Centre for Aberdeen could play an important role to encouraging innovation and developing technology needed.
“Some form of intervention will have to be implemented otherwise small pools will remain locked-in and MER in its truest sense will not be realised.
Hackathon events – one in London and one in Aberdeen – last November brought together experts from the supply chain, academia and government to come up with ideas to unlock the pools and included technological solutions as well as collaborative efficiencies, strategic initiatives and long-term research projects.
Approximately 80 delegates attended the London event and 120 attended the Aberdeen event. The input was both constructive and collaborative. It is considered that industry’s voice was heard and that the supply chain was fairly represented.
The output from the Hackathons has now been collated and contained in a report from Dr Drummond.
Although there were some novel ideas generated, there was no all-encompassing solution put forward he found.
“There’s no silver bullet,” said Drummond, “People are continually thinking about how to get after the reserves. There continues to be a lot of work done on small pools development.
There is however a need to consider small pools at a national industry-wide level. It is clear that no single owner/operator is likely to undertake the risk of proving a solution which enables small pool exploitation on their own.
“No single operator has sufficient small pool resources of their own, and the risk versus the return is simply too great,” said Drummond.
The next steps include engaging with operators on on the opportunities and marrying technical solutions to specific stand-alone stranded pools and to the clusters that could be exploited if collaboration was achieved.