Norwegian semi-state operator Statoil is planning to build a new generation mobile offshore drilling unit that is tailored to Norwegian Continental Shelf mature field conditions.
The company is about to go out to tender. Plans call for the contract to be awarded in Q3 this year, and the rigs to be delivered in H2 2014.
Statoil aims to make drilling and completion of production wells less expensive, more effective and safer, and thereby boost oil recovery.
The core objective is that the new rig will drill 20% more effectively than conventional units, so helping to counteract rising prices in the rig market.
Like the rest of the North Sea, discoveries on the NCS are getting smaller and it is becoming more important to increase drilling activity in mature fields if the full potential of Norwegian oil & gas resources is to be realised.
To meet this challenge, lower rig rates, greater drilling efficiency and access to rigs are key factors, according to Statoil.
Jon Arnt Jacobsen, chief procurement officer for Statoil, said at the launch of the initiative last month that rigs delivered to the NCS in recent years were first and foremost constructed for operations in deep water.
“That means that they are big and too costly for our requirements and challenges on the NCS,” said Jacobsen.
“We are therefore taking steps to rejuvenate the fleet and ensure that the right rig meets the requirements.”
The specifically designed category-D rig will be able to operate in 100-500m of water and drill wells to 8,500m vertical depth.
The intention is that it will be a workhorse for mature fields, primarily for drilling production wells and conducting well completion work.
In this way, Statoil and its partners hope to raise recovery rates from existing oil & gas assets.
The new lean unit has been developed in collaboration with various industry players.
Statoil is issuing a tender for a minimum of two such rigs to be provided for work on the NCS. The contract will run for either eight years with four three-year options, or for 20 years’ firm.
This is an unusually long contract period, significantly exceeding deals awarded for premium ultra-deepwater drilling units.
Statoil is taking this approach because it says this will reduce the risk for the drilling contractor that secures the work, and therefore builds the required semi-submersible rigs.
It is an approach that could never work on the UK Continental Shelf because the British offshore industry is fragmented among many operators, while Statoil is by far the dominant player on the NCS.
“Statoil is taking responsibility for a long-term development of the NCS – we see that there are still big opportunities here,” said Jacobsen. “Now we need to think anew with regard to reducing drilling costs, and we will see if it’s possible to achieve a more industrialised development.”
According to Statoil, many years have passed since big discoveries were made in Norwegian waters. Small to medium finds are made but the margins are judged to be lower.
“It is therefore necessary to reduce rig costs in order to realise the potential value,” said Jacobsen. “Small finds are also often made near existing fields. Fast developments are then important so that the existing infrastructure can be utilised.”
Oystein Michelsen, Statoil’s VP for development and production in Norwegain waters said: “The key to maintaining today’s production level on the NCS towards 2020 is improved recovery from existing fields and fast and effective development of new fields.
“In order to implement these measures it is crucial that we secure a rig fleet which is adapted to suit the assignments and which can work more effectively.”
A rig like this will be able to drill and do well completions in the North and Norwegian seas throughout the year.