Repsol Sinopec has reported that first oil has begun to flow from its flagship North Sea development.
The Montrose Area Redevelopment (MAR) could unlock up to 100 million barrels of oil and extend the life of existing fields in the area to beyond 2030.
And it all started with first oil flowing from the Shaw field in the central North Sea, 200km east of Aberdeen, which Repsol confirmed this morning.
The MAR project incorporates the development of three new fields – Godwin, Cayley and Shaw.
The operator’s managing director Bill Dunnett hailed the announcement about first oil from the Shaw as a “major achievement”.
He added:”The Montrose Area is a key part of our long-term future and we look forward to it safely delivering value for us, our shareholders and our partner Marubeni for many years to come.”
A new bridge-linked production platform (BLP) connected to the one of the oldest platforms in the North Sea, the Montrose Alpha provides additional process and plant support facilities.
The Godwin field has been developed via an extended reach well from the Arbroath platform.
The Cayley and Shaw fields have been developed as subsea tie-backs to the BLP.
Shaw production will be followed by the Cayley coming onstream by the end of Q2 2017.
Gross incremental production is expected to peak at up to 40,000 barrels of oil equivalent a day.
In addition to developing the new fields, the MAR project is expected to extend the life of the existing Montrose Area fields to beyond 2030. Montrose Alpha was originally commissioned in 1976.
Andy Samuel, chief executive of the Oil and Gas Authority, said: “First oil from Repsol Sinopec Resources and Marubeni’s Montrose Area Redevelopment project epitomises the additional value that can be achieved by integrating new and existing infrastructure to unlock significant resources from fields across the UK Continental Shelf.
“The investment in the new bridge linked platform will substantially increase the life of the Montrose Area fields with the construction stage supporting many jobs in the supply chain, including the construction of the jacket on Tyneside.
“Successful delivery of major capital projects brings significant benefits to the UK and has a vital part to play in maximising economic recovery.”
Deirdre Michie, chief executive of Oil & Gas UK, said: “This is a tremendous achievement by Repsol Sinopec Resources UK and their commitment to the North Sea is very welcome indeed.
“This is a major redevelopment in an area of the North Sea that has been producing for many years. It combines new and mature field activities that will extend the Montrose Area’s productive life and demonstrates the potential that can still flow from the UK Continental Shelf with the right investment.
“At the project’s inception, HM Treasury worked closely with the industry to begin to make the tax regime more competitive. Since then, the tax regime for this basin has improved substantially and is now one of the most fiscally competitive in the world. We look forward to more investment of the kind announced today in order to unlock the billions of barrels of oil and gas that we believe this basin still holds.”
Repsol Sinopec Resources UK Limited is the operator of the development with a working interest of 58.97%.
Marubeni Oil & Gas (U.K.) Limited is the sole partner.