 |
SVEIN TOLLEFSEN, Manager, Reservoir Technology, Statoil ASA
|
They say that the fantastic offshore oil and gas adventure in the North Sea region has surely reached its peak and is steadily heading toward decline and eventual abandonment. As an important supplier of oil and gas to the world markets, this is bad news, both for the ever-increasing global energy demands, as well as for the massive industry that has been built up over the last 50 years. And we ask ourselves, what now? How do all the companies survive the decline and how do we secure our jobs for the future?
Luckily, we saw the answer already a long time ago, and key elements included globalization and entry into other energy plays, such as heavy oil and shale gas; step changes in exploration efforts; entering into new regions farther north and also picking up the challenge right in front of us and adapting to changing conditions that come with a declining production performance.
Stretching recovery rates. I think we all know that a mature oil and gas region delivering on declining production rates does not necessarily mean a corresponding decline in activity. On the contrary, the demand for developing more effective production methods and more cost effective technical solutions could hardly be any higher. This means that the industry must keep stretching to improve profitability and increase recovery all the way through the decline phase. Long-term energy price forecasts allow us to believe in an optimistic future, where a possible change in current activity level will still increase, rather than decline, for a long time to go still. To illustrate this, Statoil is investing significantly into the establishment of new IOR competence centers in Norway and elsewhere. The biggest oil field yet to be exploited on the Norwegian Continental Shelf (NCS) has a name, and it’s “IOR”! In Statoil’s North Sea portfolio alone, we estimate that this has a potential of close to 7.5 billion bbl, nearly twice the size of the gigantic Statfjord field.
Alongside the increased focus on IOR from mature fields, a significant effort has also been put into increased exploration efforts, adding a whole row of new oil and gas discoveries on the NCS during recent years. And where previous discoveries were typically small but close to current infrastructure, the new trend is that we are also making more high-impact discoveries, many of which are found right in the middle of regions that have been previously explored without success. The biggest of them all has been Johan Sverdrup field, which is already well underway toward concept selection and development sanction. The project causes a new “Klondyke-like” situation in Norway, where previous worries for the future have been replaced by a new industry boom and growing optimism for what the future can offer.
Hard work pays off. So how is this possible? Well, it is merely a result of a deliberate change in exploration strategy, and a lot of dedicated and hard work throughout more than a decade. We have continued to acquire and evaluate high-quality seismic data, as well as use extensively all other available exploration data and knowledge. But at the same time, the exploration companies have also been better at thinking “outside the box”, and considering new exploration plays and targets that were previously deemed unsuccessful or even unthinkable. And voila, the answer was right there in front of us! Extensive work to better understand and reduce risks in high-risk/high-reward targets paid off, and drilling once again into plays like the “Utsirahøyden” in the North Sea suddenly paved the way for new industry adventures, such as the Johan Sverdrup development.
Simultaneously, we are stretching exploration and field development activities farther north. And whereas exploration drilling keeps intensifying, several discoveries are already either developed and put on production, or being developed and built as we speak. This includes the Snøhvit LNG facility and the Goliat development, opening up the Barents Sea as a future oil and gas region for the industry to keep growing and prosper. Extensive cooperation between Norway and Russia on national, as well as inter-company levels, is already taking place.
No doubt, the future of the Norwegian oil and gas industry is still bright and promising. It, for sure, ain't over yet! 
The author
SVEIN TOLLEFSEN holds an M.Eng. honors degree in petroleum engineering from the Royal School of Mines at Imperial College of Science, Technology and Medicine in London, UK. Mr. Tollefsen is a reservoir technology manager with Statoil ASA, and has previous experience in a wide range of reservoir and production engineering related disciplines. Over the past decade, he has held numerous management positions with Statoil ASA in many different countries. |
|
