How MAR supports MER

Posted 27, Jun 17

The Montrose Area Redevelopment (MAR) is about much more than two fields. The Shaw and Cayley fields that have been brought on stream in the second quarter of 2017 will add incremental peak production of around 40,000 boepd gross, and in doing so will transform the overall production profiles of both Repsol Sinopec Resources UK and of its partner Marubeni Oil & Gas UK.

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In addition to Shaw and Cayley, the third recent discovery that forms part of the MAR project is the Godwin field. This was developed via an extended reach well from the Arbroath platform and began producing in 2015.

But these are only three of a total of nine fields operated by Repsol Sinopec in the wider Montrose Area.

Although Arbroath was the first oil field to be discovered in any sector of the UK North Sea, dating back to an exploration well drilled by an Amoco-operated group in May 1969, its commercial potential wasn’t realised until 1990. By contrast the Montrose field itself was brought on stream 40 years ago this year.

Three of the other pre-MAR Monarb fields are subsea tiebacks to the main platforms: Arkwright, Brechin, and Wood – all of which should see cessation of production deferred as a result of the investment in the new bridge-linked platform and associated upgrade to the facilities on Montrose Alpha. The other field in the complex is Carnoustie. This underlies the Arbroath field and was developed by a single well on the Arbroath platform.

Jon Seedhouse, Subsurface Manager, Montrose and Arbroath, explains that life extension of the older fields was always envisaged as a key part of the project:

“About a third of the 100 million barrels that the project is projected to yield relate to life extension of the existing fields. When we sanctioned the project back in 2012, the expectation for field abandonment was that we’d be winding down by 2017 – about now – but with this new investment we are able to keep things going for longer. Maximising economic recovery is as much about getting as much as possible out of the existing fields as it is about developing the new ones.

“This works in a couple of ways. First, our operating cost per barrel for the complex comes down to a level where we can justify keeping it going for longer. Second, we improve production efficiency for these older fields: for many years production has been relying on gas compression on Montrose which has not been as reliable as we’d have liked. A lot of the older fields are producing at high water cuts so you need that gas to supplement the energy from the reservoir, and we now have new gas compression on the BLP to facilitate that.

“More reliable power generation will also contribute to better production efficiency and we have installed new generation capacity on the BLP. Cayley is a gas condensate field, which helps us in both respects as we can use that gas for power and for lifting the high water cut wells, as well as for export.”

In 1989, the Arbroath platform was installed as a satellite to the Montrose platform with Montrose providing processing and export facilities. Over the next 18 years three fields were developed as subsea tie-backs to the main platforms.

First came the Arkwright field, developed as a subsea tie-back to the Arbroath platform, with first oil in 1996. The Brechin field, another tieback to Arbroath, is a single well development that produced first oil in 2004. Issues with a riser had meant that these two fields were shut in for a few years, and had the MAR project not been realised it is unlikely that either would have been economic to restart.

The Wood field is tied back to Montrose itself and produced first oil in 2007.

Cayley and Shaw – larger fields discovered during exploration campaigns in 2007 & 2009 – demanded a larger-scale solution and it was this that eventually drove the investment decision for the bridge-linked platform that was installed in 2016.

The commissioning by government, in 2013, of the Wood Review led via the Infrastructure Act 2015 and the Energy Act 2016 to the establishment of the Oil & Gas Authority and the development of its ‘MER UK Strategy’ (Maximising Economic Recovery). The central obligation placed on oil and gas operators by this is to ‘Take the steps necessary to secure the maximum value of economically recoverable petroleum is recovered from the strata below UK waters’.

Although the sanctioning of the MAR project in 2012 pre-dates both the Review and OGA, many elements of it are in tune with the central obligation of MER UK – in particular the life extension of the infrastructure and legacy fields.

Scott Robertson, OGA’s Central North Sea Area Manager said: “The Montrose Area Redevelopment is a great example of a project which maximises economic recovery via a number of different elements.

“Nearfield exploration led to the significant discoveries Cayley and Shaw. The project added new platform and subsea infrastructure to unlock these, extend the life of the existing fields and infrastructure, and act as an enabler to support future MER opportunities in the area.

“We were delighted to work with Repsol Sinopec to create an optimised Field Development Plan which has resulted in significant additional economic reserves recovery in an area that was previously viewed as having a limited future.

“It’s also a positive story for jobs and the UK supply chain; for example with the jacket being constructed on Tyneside.”

MAR may yet also be a standard bearer for MER in the future too. Brian Winton, Montrose and Arbroath General Manager adds: “The BLP gives us a very modern production hub not only for the existing fields but for future business. This puts us in a very good place to do infill work in the future and we are working up some opportunities at the moment, so this really does breathe life back into the Montrose/Arbroath area.”