Contracts awarded by Statoil Aberdeen to the UK supply chain have now surpassed a value of GBP 1 billion.
“In the tendering process for operational contract scopes we are pleased to experience excellent capacity and quality in the UK Supply chain. We also see a constructive response to the challenges we are all facing,” said Gunnar Breivik, managing director for Statoil Production UK and head of the company’s Aberdeen office.
Speaking at the Oil and Gas Industry Conference in Aberdeen today, 17 June, Breivik underlined that the efforts to increase efficiency and reduce costs need to continue.
Collaboration
“We will need even more collaboration and contributions from the market to obtain a sustainable cost level that will allow us to continue investments in Mariner and possible new field developments over the next years and decades. We need to work together in a different way going forward than we have done in the past,” he said.
Statoil’s ambition is to work very closely with key contractors, and collaborate as partners with common goals. He pointed to the recently awarded contract with Schlumberger UK for drilling and well services on Mariner as an example of an innovative compensation format aimed at creating win-wins.
“The aim is a long-term partnership with a performance-based compensation format rewarding actual performance — metres drilled and completed — rather than usage of time and material. Together we are now establishing an integrated operations team in our Aberdeen office, working closely with both the service supplier and the drilling contractors to plan and optimise operations. The ambition is to work side by side to meet the challenges in the market, driving performance, creating value and dividing risk,” Breivik said.
Ambition to increase recovery
In his presentation of the Mariner field development, he focused on size – the size of the platform and the size of the prize:
“Dry weights of the platform at installation total around 58,000 tonnes of steel – 7.5 times the metal used in the Eiffel tower. The footprint of the steel jacket is larger than Aberdeen Football Club’s pitch at Pittodrie,” he noted.
“But more important are the sizable resources in the field. There are around two billion barrels of oil in place. Our business case is based on 250 million barrels of recoverable reserves. But we clearly have an ambition to increase that, and our teams in Aberdeen are well underway with designing a drainage strategy that could reduce risk and costs and increase recovery,” Breivik said.
Upholding recruitment of graduates
Commenting on the industry challenges, Breivik stressed the need to continue encouraging young people to seek a career in the oil and gas industry.
“Although we are growing in Aberdeen, Statoil is on a company wide basis in the process of implementing internal changes that will reduce the number of employees significantly. The supplier industry is also going through a tough time. These changes are painful but necessary. Internally, we have been very conscious of upholding recruitment of graduates and apprentices, because this is a long term industry that will need young and bright minds for many decades ahead. My perspective is that the people that will turn off the lights on Mariner are probably not born yet,” Gunnar Breivik said.
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Facts:
- The Mariner Field is located on the East Shetland Platform of the UK North Sea, approximately 150 kilometres east of the Shetland Isles.
- Statoil is the operator of Mariner with 65.11% equity. Co-venturers are JX Nippon Exploration and Production (U.K.) Limited (28.89%) and Dyas UK Ltd. (6%).
- The Mariner heavy oil field consists of two shallow reservoir sections – the deeper, Maureen Formation at 1492 metres and the shallower Heimdal reservoir at 1227 metres.
- The development of the Mariner field will contribute more than 250 million barrels reserves with average plateau production of around 55,000 barrels per day.
- The field will provide a long-term cash-flow over a 30-year field life. Production is expected to commence in 2017.
- The concept chosen includes a production, drilling and quarters (PDQ) platform based on a steel jacket, with a floating storage unit (FSU).
- Drilling will be carried out from the PDQ drilling rig, with a jack-up rig assisting for the initial years.
- Following the final investment decision in December 2012, Statoil in 2013 established an office an Aberdeen.
- Statoil’s new UK Continental Shelf operations centre is currently under construction on the Prime Four business park at Kingswells.
- More information at www.statoil.com/aberdeen