Oct. 2000 Vol. 221 No. 10  Offshore

Robert E. Snyder,  Editor

ONS 2000; UK fallow field action

The Offshore Northern Seas Conference and Exhibition, ONS 2000, convened successfully in Stavanger, August 22 – 25. We didn’t get a final attendance count, but it looked like attendance was up from the 30,000 range of two years ago. And some 1,200 exhibitors from 30 countries provided a timely display of offshore and upstream products and services.

My usual complaint with ONS still prevails. While this show is unique in that the major oil companies operating in Norway are "obligated" to make a showing, their stands are typically massive walls with a few posters and very little technical information on their ongoing projects.

In the exhibition, while most prominent international suppliers / contractors are represented, one typically finds the stands manned by their Norwegian representatives. This lets you know what the company is doing in Norway, but is little help in learning about international activity. Norsk Hydro won the coveted Innovation Award for its H-Sep system for downhole separation of wellstream fluids.

ONS Conference proceedings are not sponsored and organized by the Society of Petroleum Engineers, as are those at OTC and Offshore Europe. Thus the sessions tend to be dominated by management-oriented presentations by top-level company, political and institutional executives, primarily from Norway and Central Europe. That’s not all bad, unless one’s primary interests are the nuts and bolts, and case histories of applied technology.

One notable presentation that did focus on technology was that of Tim Warren, Director of Shell Technology EP, who discussed several specific technical developments Shell has applied in its Norwegian and international operations. And PDVSA’s César Jiménez added to the European-dominated program with a detailed report on policies and activities in Venezuela.

Greenpeace was a little more subdued this year, compared to 1998. In one press conference, they handed out a 12-page brochure in Statoil’s colors and with Statoil’s logo on several pages, proclaiming great accomplishments by the company in moving toward an oil / gas-free future. The brochure, created by Greenpeace, even includes a chart showing the complete demise of oil and gas by 2100, with solar / wind and biomass energy supplying nearly 100% of the primary energy supply mix.

While Statoil is somewhat perplexed at this unusual ploy, PR representatives that I talked to seemed to believe the best approach is to ignore it and not give them the benefit of a legal contest. To further this strange project’s early demise, I’m not going to mention the contacts on the brochure, reportedly Statoil’s VP for environment and its press officer, or the suggested website credited to Statoil but likely containing more green blah blah.

Pushing fallow fields. Dozens of UK North Sea blocks where companies were licensed to prospect during the last 36 years have become what the UK government describes as "fallow acreage" after drilling failed to find economically viable reserves. But new technology may make many of the small deposits viable, identifying oil / gas formations that eluded earlier explorations.

An initiative by the Department of Trade and Industry (DTI) has brought forward new work plans for almost 100 formerly-dormant license areas in UK waters. In addition, 18 early discoveries made in what are now fallow areas are to be developed, and a further 15 offered for sale.

Energy Minister Helen Liddell announced earlier this year that the DTI would review licensed blocks of the UK Continental Shelf where no drilling has taken place for at least six years and where any discoveries had remained undeveloped for a similar period. Almost 200 blocks were identified as being fallow; of these, three have now been newly drilled, 19 are subject to firm drilling plans and a further 77 will soon be involved in new geophysical work that will either lead to an action plan or to their relinquishment within 12 months. A total of 38 have already been relinquished or will be within a year.

DTI admits that many of the 125 areas where early discoveries were made are still not viable for development; but 18 have been declared suitable for further work, and 28 may become economic with the help of new pipeline capacity or technical advances. Another 15 blocks are being sold for new companies to explore. Meanwhile, another 123 onshore UK areas have just been opened up for oil and gas exploration by 21 companies. Almost half of the newly licensed blocks will involve exploration for coalbed methane.

MMS releases draft FPSO EIS. The Minerals Management Services (MMS) released its draft Environmental Impact Statement (EIS) on the use of FPSOs in the Gulf of Mexico. As noted in the Offshore International Newsletter, the draft document finds that potential, site-specific impacts essentially are the same as with other deepwater development / production systems. Most of the spill risk is associated with shuttle tankers and not the FPSO itself; and risks are comparable to those from other deepwater systems and pipelines.

However, the report did find that emissions associated with shuttle tankers could exceed air quality standards in the Breton Class 1 Area. Public hearings on the EIS were scheduled in four Gulf Coast cities in late September.

Santa Fe Snyder starts first Brazilian production. The company has started production from the Caraúna field located 19 mi offshore Ceará State in 60-ft water in Potiguar basin. Santa Fe is the first foreign operator to develop production offshore Brazil since opening of oil / gas exploration to non-Brazilian companies in 1998. Santa Fe now has a total of four blocks, with recent award of an exploration block in Campos basin.

The company will drill at least two exploration wells on BPOT-2 and BES-3 leases in 2000 in addition to the Caraúna development. Production started from CES-124, a re-entered Petrobras well, at an initial rate of 1,000 bopd. Three more wells will be re-entered and two additional wells drilled this year to gather information for a final development plan. The present well is being produced through a MOPU into an FSO.