Maersk Oil begins drilling on Culzean project, launches organizational review

Maersk Oil, a wholly owned subsidiary of AP Moller-Maersk AS of Copenhagen, started drilling the first production well on Sept. 28 in the company-operated Culzean field in the UK North Sea.

The well is the first of six production wells to be drilled in the high pressure-high temperature (HPHT) field, with continuous drilling planned over the next 5 years. The start of natural gas production is expected in 2019.

The Maersk Highlander rig is drilling the first production well through a wellhead platform (WHP) jacket and well access deck (WAD) installed in the field during the spring (OGJ Online, June 9, 2016). When the three topsides are installed in 2018 and hooked up in 2019, three of the six production wells will be ready for gas production.

The WHP jacket and WAD were constructed in the Netherlands and Hartlepool, UK, with construction of the wellhead topsides ongoing in Singapore. The drilling campaign will be supported by more than 30 UK-based well services companies.

Maersk Drilling and Maersk Oil have jointly prepared the drilling on a digital “virtual well,” using a specialized drilling simulator at Aberdeen’s Robert Gordon University.

“Working on a virtual rig, designed to look and feel like the Maersk Highlander has been invaluable,” commented Andrew Lough, Culzean’s wells delivery manager for Maersk. “It has enabled us to prepare in a very lifelike environment for the drilling campaign,” he said.

Organizational review

Maersk Oil also reported on Sept. 29 that it’s launching an organizational review of “the scope and scale of its headquarters organization over the next 3 months in response to the recent outcome of the Maersk Group’s strategic business review and Maersk Oil’s exit from Qatar in 2017.”

AP Moller-Maersk last week said it was separating its transportation and oil businesses, aiming “to find solutions for the oil and oil-related businesses within 24 months (OGJ Online, Sept. 23, 2016).”

In June, Maersk Oil was informed by Qatar Petroleum that it had selected Total SA as partner for future development of Al Shaheen field, which Maersk Oil currently operates under a 25-year production sharing agreement expiring in July 2017 (OGJ Online, June 27, 2016).

“Despite a solid operational business performance, which saw the company return to positive earnings in the second quarter of 2016, Maersk Oil needs to continue to adjust the business to the continued low oil price, changes to both the portfolio and to long-term growth plans,” the company said.

The review will be completed during the remainder of 2016. However, an initial phase to reconfigure the company’s growth organization and reduce the technology and projects group will be completed by the end of October.

“Maersk Oil’s commitment to grow in the next few years is underscored by $1-2 billion in annual capex to deliver the exciting Culzean and Johan Sverdrup projects. They will deliver 100,000 [bbl] of new production to Maersk Oil,” commented Gretchen Watkins, Maersk Oil chief executive officer-designate.

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