A new gas project west of Shetland shows there is still a bright future for the UK North Sea industry, Energy Minister Matt Hancock said last night.
He was speaking after French energy giant Total announced it had received Department of Energy and Climate Change approval for its £990million Edradour and Glenlivet field development plans (FDPs).
The decision to invest was taken by Total last May. UK Government sanction for the FDPs allows Total, which has an 80% stake, and Danish partner Dong Energy (20%) to progress to development.
Edradour and Glenlivet will be tied back to the Total-operated Laggan-Tormore subsea infrastructure, and are expected to add reserves of more than 65million barrels of oil equivalent.
Start-up from Total’s Laggan-Tormore gas development is expected later this year. Combined with the two nearby fields, it will create a third operated hub for Total in the UK North sea to add to the Paris-based firm’s existing Alwyn North and Elgin-Franklin assets.
Total, which banking sources claim have claimed wants to sell its 80% stake in Laggan-Tormore as North Sea operators look to offload assets in the wake of the slump in oil prices, insisted yesterday its west of Shetland interests were “core” and of strategic importance.
Edradour is in North Sea block 206/4a, 47 miles north-west of Shetland. Its FDP consists of the conversion of a discovery well into a production well and a 10-mile pipeline tied back to the main Laggan-Tormore flowline.
The field is expected to start producing gas in the fourth quarter of 2017, reaching a plateau of 17,000 barrels of oil equivalent (boe) per day at an estimated development cost of £340million.
Glenlivet is in block 214/30a, 56 miles north-west of Shetland. It will be developed with two wells and a 22-mile pipeline tied back to Laggan-Tormore.
First gas from this field is expected in the third quarter of 2018, reaching a plateau of 21,000boe per day at an estimated development cost of £650million.
Mr Hancock said: “This announcement shows that, following the Budget and with the rapid set up of the OGA (Oil and Gas Authority) following the Wood Review, the UK continental shelf (UKCS) has a bright future ahead of it.
“These new fields have around 10 years of production ahead of them, which means security for workers both offshore and employed through the associated supply chain.
“It’s important for the UK that the long term outlook for the UKCS remains positive, and the government continues to work together with industry to achieve this.”
