The biggest un-developed North Sea oil field just got three times bigger today after new tests confirmed the size of Hurricane Energy’s west of Shetland field now contains more than 1,000-bn barrels.
A colossal column of oil – extending to more than one kilometre in depth – has been confirmed in new tests by Hurricane Energy on its Halifax field.
Hurricane’s recently discovered adjacent and adjoining Lancaster field contains an estimated 400 million barrels – which last year made it Britian’s biggest un-developed field.
Now Hurricane Energy has confirmed that its nearby Halifax field is at least three times bigger, with reserves of more than 1,000-bn barrels.
Ashley Kelty, an oil analyst at Edinburgh-based Cenkos, said: “The Halifax well was drilled some 20 miles northeast of the Lancaster discovery with the objective to test the hypothesis of a reservoir extension into the new block and that it is a single oil accumulation.
“The fact that oil was encountered at a greater depth to that seen at Lancaster, coupled with the analogous reservoir quality would strongly suggest that Lancaster-Halifax is one large accumulation – potentially making this the largest undeveloped oil discovery on the UKCS.
“We would estimate that the size of the oil column and discovery location would infer the Halifax discovery may be of a similar size to that of Lancaster, which we estimate at 407 mmbbls.
“However, it is conceivable that the combined discoveries offer an even greater reserve quantum of over 1bn bbls.”
Following discussions with the Oil & Gas Authority, the Halifax Well has been suspended to allow for potential future operations to either deepen and/or undertake further testing of the well, the programme for which will be determined following analysis of these preliminary well results.
Dr Robert Trice, Chief Executive, Hurricane Energy, said today: “This is a highly significant moment for Hurricane and I am delighted that the Halifax Well results support the company’s view that its substantial Lancaster discovery has been extended to include the Halifax licence.
“We believe that the Greater Lancaster Area is a single hydrocarbon accumulation – making it the largest undeveloped discovery on the UK Continental Shelf.”
Kelty added; These results are hugely positive for Hurricane Energy, as they confirm that the basement reservoir extends far beyond the Lancaster locale.
“Whilst further appraisal drilling will be required to prove up the reserves across the Lancaster/Halifax area, it is apparent that the combined discoveries have proved the presence of a giant field.
“The successful horizontal well at Lancaster and the Lincoln discovery have added significant resources to a contingent resource base that we estimate to be more than 1.3bn bbls – unrivalled by any peers.
“Hurricane has unlocked this play and exciting times lie ahead as the company moves towards production.
The 2016-17 drilling campaign is now complete, with Hurricane having a 100% success rate with the drillbit.
The end of the Halifax Well marks the completion of the 265 days during which Hurricane has had the Transocean Spitsbergen rig on hire. It successfully drilled one development (Lancaster Sidetrack), one appraisal (Lancaster Pilot), one intervention on the 2014 horizontal well (in preparation for well completions in Q2 2018) and two exploration (Lincoln and Halifax) wells.
Trice added: “The exploration wells on Lincoln and Halifax have resulted in the discovery of extensive oil columns and we therefore expect that later iterations of our CPR will significantly upgrade our resource base on both the Greater Lancaster and Greater Warwick Areas.
“These are exciting times for Hurricane.”
Welcoming the massive new oil find, Highlands and Islands MSP Maree Todd (SNP) said: “This is a significant discovery and a welcome reminder of the huge untapped potential that remains in Scottish waters.
“But to maximise the long-term benefits for Scotland, it is vital that the right UK fiscal regime is in place to bring more new discoveries on-stream. Only by stewarding new prospects to production will we reap the benefits in terms of creating jobs and boosting our economy.”
MSP Alexander Burnett, Scottish Conservative energy spokesman, added: “This is very welcome news for the UK Oil and Gas industry and comes at a time when exploration activity has been low.
“The data gathered by Hurricane Energy would suggest this could be a hugely significant discovery.
“It is also welcome to hear about the positive collaborative work between Hurricane and Transocean, which is something that the UK Government has been encouraging through the Oil and Gas Authority.
“This announcement also follows encouraging news from the regulator last week that 25 licences have been issued for other undeveloped regions including Rockall and East Shetland.”
Meanwhile, the market-price of benchmark Brent crude oil continued to slide as as investors fretted over whether producing nations will extend an OPEC-led output cut beyond the end of June in an effort to reduce a global glut of crude. Brent fell 39 cents to just over $50- barrel, before recovering slightly to $50.60.