Lloyds List: Rising level of drilling in UK North Sea leads to new oil finds: “Drilling this year has led to new oil discoveries, including Amerada Hess' Melville in the northern sector and Shell finding oil at Phoenix near the Nelson platform.”: Tuesday 19 July 2005

UKOOA says 37 wells started in first half of this year represents a 9% interim increase and follows 40% E'A surge in previous year, writes Martyn Wingrove

EXPLORATION activity in the UK sector of the North Sea is up again this year, leading to new discoveries and more sanctioned offshore projects.

As oil independents look to drill on more of their exploration blocks so the number of wells drilled has increased.

According to the UK Offshore Operators Association and Deloitte analysts, 37 exploratory wells were started in the first half of this year, a 9% rise from the same six months last year.

In 2004, 63 wells were drilled all through the year, which was a 40% increase in exploration and appraisal activity in 2003.

UKOOA's latest forecast for this year is for around 74 E'A wells.

'This year is better for exploration, and interest in the latest licensing round was at a 30-year high,' said Mike Tholen, economics and commercial director at UKOOA.

'More companies than ever are looking to invest in the UK in exploration and extend the life of producing assets.'

Of the 37 drilled from January to June this year, 22 were exploration wells and 15 appraisal wells, said UKOOA.

Of these 57% were in the central sector, 24% in the northern North Sea and 19% in the southern basin, said analysts at Deloitte.

Drilling this year has led to new oil discoveries, including Amerada Hess' Melville in the northern sector and Shell finding oil at Phoenix near the Nelson platform.

Exploration success has led to Oilexco discovering more reserves at Brenda and Nicol and close to the MacCulloch field, plus BG discovering the Maria field northwest of its Armada platform.

In the southern basin, Gaz de France drilled gas on the Opal prospect near the Caister-Murdoch system and Newfield found more gas with the Grove well.

Of these, Grove, Maria and Brenda are set to be developed in the next two years, with Phoenix, Opal and Melville likely to be development candidates.

Exploration drilling continues into the third quarter with new wells spudded in the central and southern sectors.

Canadian oil firm Nexen has spudded a well in block 15'18a, east of Talisman's Piper platform, using the Sedco 712 semi-submersible rig, on a sublet from Oilexco.

The rig will be working on the well until August when it will be moving to drill an appraisal well on the Black Horse discovery, close to Nexen's Scott platform.

Calgary-based Oilexco will earn a 40% interest in block 15'22 by paying 60% of the well costs estimated at GBP8.4m. The well could take 84 days to probe Black Horse, which was tested in 2003 at a rate of 6,583 barrels per day with the discovery well.

'The Black Horse appraisal drilling opportunity continues our focus on undeveloped discoveries and low risk exploration in the UK,' said Arthur Millholland, Oilexco's president. 'This project along with our Brenda and Nicol developments continues our evolution into a North Sea focused exploration and production company.'

Also in the area, Kerr-McGee has started an appraisal well on the Dumbarton discovery in block 15'20b that could lead to its development with a floating production storage and offloading vessel.

The Oklahoma-based company is using the Noble Ton Van Langeveld rig to drill on Dumbarton, which lies below the decommissioned Donan field.

If successful, Kerr-McGee may move the Global Producer III production ship from the Leadon field, which has been under-performing, to Dumbarton, where the vessel could also become a hub for Oilexco's Brenda.

In the southern sector, Tullow said it had spudded an exploration well on the Oval prospect in block 54'1a, close to the Dutch border and its Horne-Wren platform.

Meanwhile, Canadian oil independent Antrim has confirmed it will participate in three exploration wells this year, starting in mid-September with a probe on the Prometheus prospect in block 42'22, close to the Ravenspurn gas field.

Antrim's second well will be drilled in October by Dana on the Clachnaben prospect in block 211'22a close to Shell's Cormorant platform. If successful, the well could be a fast-track satellite development to the platform along with the 211'22a-1 discovery.

Antrim's third well will be drilled by Nexen on the Bennachie discovery in block 21'15a, which was originally tested at 4,364 barrels per day. The GBP7.8m well will be drilled close to Apache's Forties platform facilities and could become a satellite if successful. 

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