WORLD EXCLUSIVE by Scottish Energy News
BP has today announced a $1 billion investment (£670 million) to extend the economic life of a N. Sea oil field.
The company hopes the investment will ensure its Eastern Trough Area Project will continue operating for a further 15 years to 2030.
Only by improving operating efficiencies, finding new and cheaper to mine oil – or both – will the North Sea oil and gas industry be able to extend its working life beyond the current projected 12-15 timescale if Brent crude oil prices remain at £50-barrel.
BP’s North Sea president Trevor Garlick today admitted:
“These are challenging times for the industry and we are having to make hard choices.
“Nonetheless, we remain committed to improving the competitiveness of the North Sea and to maximising economic recovery from our fields.
“BP’s primary areas of focus are the west of Shetland and central North Sea, where we are investing in both new developments such as Clair Ridge and Quad204, and in extending the life of our mature assets.
“Two weeks ago we welcomed the arrival of the Safe Caledonia flotel into the ETAP area, launching the start of a major investment programme to renew the platform and extend its field life.
“In parallel, we are drilling new wells on ETAP’s Machar and Marnock fields, replacing subsea infrastructure, and deploying new technologies to help maximise the fields’ recovery.
“ETAP holds significant potential and we are working to ensure its reliability, efficiency and long-term competitiveness. “This project will secure the future of the field until 2030 and beyond.”
A spokeswoman for the Aberdeen-based oil and gas trade association, UKOG, commented: “Oil & Gas UK is pleased to welcome BP’s announcement today of a $1billion investment in its Eastern Trough Area Project, securing the project’s future for a further 15 years to 2030.
“According to figures from the Department for Energy, the country’s primary demand for oil and gas, critical for our transport and heating and powering our homes, is set to remain unchanged until 2030 at least.
“It is encouraging to see the continuing investment BP is making in its North Sea assets and projects to deliver a secure indigenous supply of energy for the country.
“Given the harsh business environment upstream oil and gas companies currently face, with the oil price more than halved since this time last year, industry as a whole is putting a great deal of effort into improving the performance of its assets – and that is something we’ll look to explore in further detail in our 2015 Economic Report next month.”
ANALYSIS: Can UK oil and gas regulator save N. Sea ‘Jurassic Park’ industry from extinction in $60-barrel climate? – http://goo.gl/Zmm1ZR
Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy