Plant modifications slow progress on UK Breagh gas project

Offshore staff

CALGARY, Canada – RWE Dea’s Breagh gas development in the UK southern North Sea will likely incur cost and schedule overruns, according to partner Sterling Resources. These are connected to modification works at the Teesside Gas Processing Plant (TGPP) that will receive Breagh’s production.

The program was scheduled for completion by mid-year, leading to first gas from Breagh this summer. Start-up is now targeted for 4Q.

If mitigation measures cannot be implemented, development expenditure for Phase 1 of the Breagh development could be in the range $926-934 million, 4-5% above Sterling’s previous estimate.

However, development drilling, which started this month, will not be affected by onshore delays. Four wells should be onstream by the end of the year. The jackup ENSCO 70 has started operations on both previously suspended wells 42/13-3 and 42/13-5Z, re-running conductors through the platform and, in the 42/13-3 case, re-running the production casing.

In June, side tracking is scheduled on the 42/13-3 well over the reservoir interval, followed by similar work on the 42/13-5Z well in July. Eventually up to eight further development wells will be drilled.

Sanction for Breagh Phase 2 has been postponed until later in 2012. The options include a second platform, or a subsea development of the field’s eastern side tied back to the in-place Breagh platform.

Additional seismic interpretation, reservoir modeling, and data from the first production wells will be factored into the Phase 2 concept selection.

5/24/2012

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