Repsol Sinopec Resources UK has cancelled its Tain oil project which was planned for the UK North Sea.
As recently as May this year, partner Viaro Energy said Tain would be developed through Repsol Sinopec’s Bleo Holm vessel, with first oil in 2025.
However in a statement, Repsol Sinopec, which operates the project, confirmed it has been dropped.
“Together with our joint venture partner RockRose (owned by Viaro), we have decided we will not develop the Tain field,” said a spokesperson.
“The Tain development is no longer an active project and the joint venture partners no longer hold the licence.”
It’s understood the decision comes as the Tain licence, 50-50 owned by Repsol Sinopec and Viaro, came to the end of its second term on September 22.
Repsol Sinopec and Viaro allowed it to lapse after carrying out a study, which concluded the field was no longer attractive due to risks around its recovery factor and uncertainty on the life span of nearby infrastructure.
Serenity
The move casts an uncertain shadow over the future of the nearby Serenity project, which i3 Energy (AIM: I3E), based in Aberdeenshire, had hoped to unitise with Tain and develop through the Bleo Holm.
Serenity, once hailed as a 100 million-barrel “company maker”, last year had disappointing appraisal results with hydrocarbons “not present” at the well.
Despite that, i3 said there was still a way forward for the project at the time – which could still be the case even with RSRUK and Viaro exiting.
It’s understood work has been underway for some time to advance a solution for the Blake/ Tain / Serenity area, but this has made little progress.
With the acreage now unlicenced, additional options for the field may become available with new partners,
i3 Energy and Europa Oil and Gas, the latter owning 25% of Serenity, are in talks with the NSTA and other parties to explore the remaining potential of the area.
Europa said in January that it hoped to reach a unitisation deal with Repsol Sinopec early in 2023.
Tain
A small oil project in the Moray Firth, the 10 million-barrel Tain project had been in FID doldrums for years.
Repsol Sinopec submitted a development plan in 2020 to the regulator, which has since been approved.
Though this latest decision hasn’t been clarified by Repsol Sinopec, it comes amid a backdrop of lower oil prices since 2022, a high tax environment in the UK and the Serenity well results.
Repsol Sinopec had 50% of the project as operator, with Viaro holding the remainder.
Viaro Energy CEO Francesco Mazzagatti said: “Despite the initial optimistic prognosis and the best efforts of the RockRose and Repsol Sinopec teams, we have not been able to find a feasible way forward to develop the Tain field.
“This is one of the many ways in which the EPL is limiting our ability to maximise the potential of UKCS assets, which is impacting the financial viability of both existing and prospective developments.”