The government has given Statoil consent to drill one of the biggest developments ever in the North Sea.
The development of the £4.6bn Mariner heavy oil field has been made possible through a partnership between government and industry, and is the largest new offshore development in the UK in more than a decade.
Statoil expects to start production from Mariner in 2017, and the field is expected to produce for 30 years. At its peak it is expected to produce around 55,000 barrels of oil per day, 5 per cent of UK daily production, from 2017 to 2020.
“Statoil and its partners appreciate the cooperation from the UK government and the approval of the development plan for this landmark project,” said Helge Lund, president and CEO of Statoil.
“The North Sea is a core area for Statoil and we look forward to taking a leading role in further developing also the UK part of this basin.”
Statoil will establish an operations centre for Mariner in Aberdeen, and the project will lead to substantial job creation in the region over the 40-year operational phase, both in construction and operations, with more than 700 long-term, full-time positions.
The Mariner field is located on the East Shetland Platform of the UK North Sea approximately 150km east of the Shetland Isles.
It was discovered in 1982, but development could not be progressed at the time because of the technical challenges involved in developing this dense and viscous oil offshore.
With technology developments in the 1990s, in particular horizontal drilling and improved well completion techniques, development became more attractive, but progress remained slow.
It was declared fallow by the government in 2005, which facilitated a realignment of licence interests, the acquisition of new seismic in 2008 and the submission of a Field Development Plan in September 2012.
Statoil has extensive heavy oil experience from offshore fields in Norway and Brazil, which will enable it to develop the Mariner field.
The field will be developed with a production, drilling and quarters (PDQ) platform, based on a steel jacket, with 50 active well slots and a floating storage unit (FSU) of 850,000 bbls capacity.
In addition a jack-up rig will be used for the first four to five years.
Since Statoil entered in 2007, the company has developed a leading heavy oil position in the area, being the operator with 65.11 per cent equity in Mariner and 81.6 cent equity in the Bressay field.
UK Energy and Climate Change Secretary Edward Davey said: “North Sea oil and gas is a vital asset. It provides energy security for the UK, reduces our reliance on volatile international energy markets and supports hundreds of thousands of jobs across the country.
“Mariner will be one of the biggest projects ever in the North Sea and the £4.6bn commitment over 40 years from Statoil is a vote of confidence in the future of UK oil and gas.
“Importantly, unlocking heavy oil production marks a new chapter in development, opening the potential for five per cent of our oil reserves."
He added: “The government is working hard with industry to ensure North Sea oil and gas continues to provide energy security and jobs.
“Our efforts to get unused fields into production, a fiscal regime that encourages investment – together with new, advanced technology – is extending UK oil and gas production beyond what was thought possible.
“The result is that North Sea investment is at an historic high, with Mariner joining an ever-growing list of recent field approvals.”