Tornado/Suilven joint development possible

Jeremy Beckman
Editor, Europe

ABERDEEN, UK -- Dana Petroleum is preparing a wide-ranging program of exploration and development off northwest Europe, according to the company’s latest results overview.

Last year, Dana participated in 17 exploration wells which delivered four commercial discoveries in the region. These comprised SE Rinnes in the UK northern North Sea (Dana-operated); Tornado, West of Shetland (OMV); Fulla (Statoil) and Jetta (det norske oljeselskap), both in the Norwegian North Sea.

Tornado was Dana’s first well in the West of Shetland area. Reservoir properties and in-place volumes seen after drilling to date appear to be in line with pre-drill expectations, although the discovery contains gas as well as oil. The partners will focus now on refining the subsurface model: Dana says a joint development is possible with the neighboring Suilven discovery, which has similar hydrocarbons.

Dana has welcomed the UK government’s decision to extend its field allowance concept to remote gas fields in the West of Shetlands area. It believes this could encourage development of infrastructure projects which would benefit Tornado and other area finds such as DONG’s Glenlivet gas field.

The SE Rinnes oil discovery will form part of Dana’s Western Isles Development, estimated to hold gross reserves of around 65 MMboe. The company has been working on subsurface evaluation, and negotiating with potential host infrastructure and floating production system owners.

Dana aims to single out its preferred host platform by May and to achieve project sanction this fall. It is also in discussions to allow CIECO to back-in to the Lewis and Harris (formerly West and East Rinnes) discoveries which were made by Dana on a ”sole-risk” basis in 2008.

In the UK southern gas basin, development of the Dana-operated Babbage field is said to be going well, with first gas expected by mid-year. The jacket and topsides have been installed, and tie in is under way between the Babbage platform and the West Sole complex. The three initial development wells have been drilled to total depth, with the third due to be completed shortly. The main work outstanding is topsides completion and fracing of the wells.

On the Barbara/Phyllis gas development in the UK Central North Sea, Dana has issued a selection of host platforms to its partners. Subject to approval, a FEED study will then be conducted which should lead to project sanction this fall, and first gas in 2012.

As for Norway, Dana says the Fulla gas discovery has been declared commercial, and development could also encompass re-development of the nearby Lille Frigg field. The Jetta oil discovery is relatively small, but could be tied into the nearby producing Jotun field. Oil was also discovered in the Heimdal sands at the Eitri prospect.

Dana has just been awarded six licenses under Norway’s APA2009 round, comprising two licenses in the Norwegian Sea, and four in the North Sea, including two extensions to existing licenses where Dana achieved discoveries last year.

Offshore the Netherlands, the E18 gas field was brought onstream ahead of schedule last June. Dana says a further exploration target has been identified and should be drilled this spring.

Also in 2010, the company has budgeted funds for infill wells in the producing Claymore, Ettrick, and Cavendish fields in the UK sector, and will consider further infill opportunities in the Chestnut, Johnston, and Otter fields in the UK and its Dutch gas fields.

Further exploration drilling is planned on the Anne Marie prospect on the Atlantic margin; the Storkollen prospect off Norway; and in the UK Southern North Sea (three wells), where Dana expects to benefit from the recent decline in jackup rig rates.

01/29/2010



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