Douglas Westwood: North Sea – Hope for Declining Production?

Western Europe will continue to rely on imported Russian gas into the 2020s as mature offshore provinces struggle for growth, while large-scale shale gas extraction looks increasingly unlikely in the medium term, Douglas Westwood said in its DW Monday report.

Johan Sverdrup field in Norway

Following Moscow’s intervention in Ukraine and the resulting strained diplomatic ties with the West, it remains to be seen if North Sea production can rally to support any drop in gas flow from Russia.

With many IOCs planning investment into UK offshore fields through enhanced oil recovery (EOR), deeper water plays and downstream infrastructure upgrades, our Development Drilling & Production Forecast predicts that production will rally slightly to around 1.75 million b/d by 2017, requiring a maintaining of the recent 6% jump in well completions. The necessary high levels of expenditure are unlikely to be sustained in the long-term due to the UK’s offshore maturity; therefore, DW expect a resumption of decline towards the end of the decade. Hope for any long-term growth rests with much-needed reform of the UK’s offshore regulator, which must swiftly adapt to the shift towards production from smaller fields.

On the other side of the North Sea, Statoil is to attempt improved recovery from brownfield projects offshore Norway. Along with the start of projects in the large Johan Sverdrup and Goliat fields, this will see the number of well completions sustained at around 200 a year beyond 2020. DW expect these projects will see Norway break from the mould of other mature Western European producers and sustain production into the next decade. It must be noted, however, that both of these fields are currently subject to delay. Johan Sverdrup is facing electrification issues whilst ENI’s Goliat FPSO is still to be completed and may take millions of man-hours more.

Potential risks to future growth include rising costs and the potential (albeit currently small, and in the longer term) competition from shale gas production. A recent victim of rising costs was the subsea compression project at Ormen Lange, despite positive results during testing and the backing of Statoil and ExxonMobil. Recent onshore legislation changes in the UK now allows for drilling and pipeline construction under private property. This, along with growing encouragement from Westminster of E&P companies, shows that shale gas extraction could be possible on a larger scale towards the end of the decade.

 

Source: Douglas Westwood, May 12, 2014

 

Share this article

Follow Offshore Energy Today

Events>

<< Apr 2019 >>
MTWTFSS
1 2 3 4 5 6 7
8 9 10 11 12 13 14
15 16 17 18 19 20 21
22 23 24 25 26 27 28
29 30 1 2 3 4 5

GeoConvention 2019

GeoConvention offers some of the best local and international insights to efficient energy exploration…

read more >

16th MOSCOW INTERNATIONAL OIL AND GAS EXHIBITION

The Moscow International Oil & Gas Exhibition display products like oil and gas products, oil and gas services…

read more >

Erbil International Oil & Gas Exhibition 2019

The event will be held at the Erbil International Fair Ground which is one of the largest energy related events in Iraq…

read more >

THE 24 th IRAN INTERNATIONAL OIL , GAS , REFINING & PETROCHEMICAL EXHIBITION

The second largest OPEC producer, Iran sits atop 11 percent of oil and 18 percent of gas…

read more >

Jobs>

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply

Looking to fill a job opening?

By advertising your job here, on the homepage of OffshoreEnergyToday.com, you'll reach countless professionals in the sector. For more information, click below...

apply