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Posts Tagged ‘Newfoundland’

Hebron gravity based structure

While checking for updates on the important Orphan Basin well, I looked at Newfoundland production data and found it surprisingly encouraging:

  • The pioneering Hibernia field has produced more than double the original resource estimate of 520 million barrels, and is still chugging along at about 60,000 bopd.
  • Hebron, the current top producer, is holding strong at 100,000+ bopd.
  • White Rose, which was in danger of being abandoned, is poised for a renaissance with the installation of the West White Rose concrete gravity structure.
  • Terra Nova is once again producing at near 2019 levels after a four year hiatus. The Terra Nova story has many important technical, management, regulatory, safety, and logistical elements, and presents good case study opportunities for Newfoundland academics (Memorial University?).

With prospects for production at Bay du Nord brightening and interesting targets like the Orphan basin being explored, pessimistic forecasts for Newfoundland’s resilient offshore sector may be a bit premature.

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Per rig tracker data, the Stena DrillMAX has been on location at Exxon’s Orphan Basin wellsite since Sunday (19 May). The site is 317 miles (510 km) NE of St. John’s in Block 1169 (~3000 m water depth).

Per this very good resource assessment report for the Govt. of Newfoundland and Labrador, “the Orphan Basin area demonstrates a potentially prolific petroleum system with four main plays (reservoirs and associated seals) sourced by various source rocks (Upper Jurassic, Cretaceous, and Paleogene).“

Unrisked resource estimates (theoretical pending confirmation by drilling) at the 90, 50, and 10% probability levels for the Orphan Basin blocks offered for licensing in Nov. 2022:

Taking into account the risks of the geologic model not accurately reflecting the reservoir, seal, charging, and trap components of the petroleum system, the probability of finding 13.5 billion drops to 16% (see plot below). This is still a high probability for a massive wildcat discovery.

This is why you move a state-of-the-art drillship thousands of miles to drill a single exploratory well at a remote location in the North Atlantic. The most likely outcome is negative or inconclusive findings, but the potential for such a major discovery justifies the investment.

The PGOS curve quantifies the probability of success in finding the identified volume of resources in the new Orphan Basin blocks (e.g. there is a 34% chance of finding 4.7 billion BOE and a 16% chance of finding 13.5 billion BOE).

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The Valaris DS-17 drillship is now on location to drill the Algerich-1 well for Equinor 315 km from Mar del Plata in 1527 m of water at Block CAN 100.

Concurrently, at the opposite end of the Pan American continents, the Stena DrillMAX is closing in on Exxon’s Orphan Basin location offshore Newfoundland to drill another high potential well.

Meanwhile, the US Atlantic is “wind-only,” despite high deepwater oil and gas potential. The late Paul Post, an esteemed colleague and the leading expert on the petroleum geology of the US Atlantic, believed the deepwater US Atlantic could contain >20 billion BOE. No other Pan American nation has completely closed its Atlantic margin to oil and gas exploration.

Can a nation with a debt of $35 trillion afford to ignore oil and gas resources that will remain in high demand for decades?

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The DrillMAX is en route from Guyana to drill the Persephone wildcat well 500 km NE of Newfoundland in the highly prospective Orphan basin (3000 m water depth). This looks like the farthest from shore any well has been drilled in the Atlantic. The late spring date is prudent.This is definitely a well to watch because of the resource potential and difficult operating conditions.

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The CNLOPB has announced contingent resources of 340 million bbls for the Cambriol discovery which would be co-developed with 2 nearby discoveries as part of Equinor’s Bay du Nord project. Per CNLOPB estimates, this brings the Bay du Nord resource total to 1.132 billion bbls. Equinor has announced that 2 exploratory wells will be spudded this summer. Positive results would further strengthen the case for Bay du Nord development.

contingent resources per CNLOPB (million bbls)
Bay du Nord407
Cappahayden385
Cambriol340
project area total1132
“Contingent Resources” are volumes of hydrocarbons, expressed at 50% probability, assessed to be technically recoverable that have not been delineated and have unknown economic viability.

Meanwhile, Terra Nova production is ramping up after a long hiatus for FPSO refurbishment, remarkable Hibernia has produced more than double the original resource estimate of 520 million bbls and is still producing about 60,000-70,000 bopd, and Hebron is impressively producing about 120,000 bopd on average.

There is indeed reason for optimism about North America’s only Atlantic production in what is arguably the continent’s (world’s?) most challenging operating environment.

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Short answer: Yes!

Ocean Ranger sign
recovered Ocean Ranger sign

A good article and video on the topic are linked. During my last visit to St. John’s, the late Charles Smith gave me an excellent tour of the Marine Institute that is featured in the video. The Institute is an outstanding training facility that has reduced operating risks offshore Newfoundland and elsewhere.

Posts about the Ocean Ranger tragedy.

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Ed Tennyson

Edward J. Tennyson passed away last Friday at his Smith Mountain Lake, Virginia home. Ed worked in the Department of the Interior’s offshore program for more than 20 years, and arguably has done more than any single individual to advance oil spill response capabilities. A few of Ed’s many achievements:

  • Ohmsett: EPA operated the Ohmsett spill response test tank in Leonardo, New Jersey, beginning in the early 1970s, but the facility fell into disrepair in the 1980s. Thanks to Ed’s vision and persistence, and the enactment of the Oil Pollution Act of 1990, the Minerals Management Service (MMS) began restoring the facility. Ed led the effort and did everything from operating forklifts to designing upgrades. Senator Frank Lautenberg (NJ) and a host of dignitaries participated in the grand reopening event in 1992. It was an amazing day, and Ohmsett, MMS’s only industrial facility, has exceeded even Ed’s lofty expectations. 
  • Burning oil slicks: Ed and a few of his US and international partners were the first to consider in situ burning as an oil spill response method. After some lab work, Ed proposed larger scale testing at Ohmsett in the presence of ice. The testing was amazingly successful, removing almost all of the oil. When Ed told a leading skeptic about the impressive results, his response was “you didn’t do it right.” 😀 
  • Newfoundland burn: Because research spills were prohibited in US waters, Ed worked with his Canadian partners to conduct an in situ burning test offshore Newfoundland in 1993. Ed was an amazing leader during any kind of field trials, and was always the first person on the dock directing team members to their stations!
  • Remote sensing: Ed’s research led to a patent on the use of shipborne radar for locating oil slicks. Ed greatly advanced this capability by developing tools for airborne mapping and thickness determinations. As Ed frequently said, “90% of the oil is in 10% of the area.” By identifying where the oil was thickest, you could optimize spill response. (Ed was also an expert at identifying slicks with what he called his mach 20 eyeball 😀).
  • Chemical treatment: Ed was a leader in researching dispersants, herding agents, and other chemical methods for preventing spills from impacting shorelines or other sensitive areas.

Ed was an entertaining and informative speaker and was often called upon to brief congressional panels, and discuss his research at public meetings and professional conferences. He was rightfully a media darling and was often contacted for comments on oil spill response matters. Perhaps his most famous quote was in the Wall Street Journal during the Valdez spill in Prince William Sound. Ed described the spill response as follows: “Like mowing a 40 acre field with a 1/4 inch lawn mower.” 😉

RIP Ed, you made a difference!

Newfoundland Offshore Burn Experiment, 1993

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Newfoundlander Howard Pike shared this interesting video.

BP’s Ephesus well – why was it a failure?

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An international regulatory colleague brought this puzzling RigZone article to my attention. Quotes:

“From one perspective, one can look at the overall absence of risk – from this perspective, we can easily say that either the United Kingdom’s North Sea or Canada’s Nova Scotian continental shelf is the safest region for offshore oil and gas operations right now,” Robak told Rigzone.

“Canada’s offshore industry accounts for approximately one million barrels per day, and its geographic location along the Nova Scotian continental shelf has been a benefit in that there is little to no risk to its continued operation on a day-to-day basis,” Robak said.

Comments:

Scotian shelf

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41 years ago today, 84 men lost their lives on the Ocean Ranger. BOE’s 40th anniversary posts can be viewed here and here. The excellent 40th anniversary tribute video is embedded below. Remember these heroes.

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