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Lloyds List: New Phoenix oil find set to be satellite of Nelson platform: Royal Dutch/Shell is already making plans for its recent discovery in the central sector, writes Martyn Wingrove: “ROYAL Dutch/Shell has discovered oil in the UK central North Sea…” ( 15 March 05


ROYAL Dutch/Shell has discovered oil in the UK central North Sea with its Phoenix structure and is already planning to develop it as a satellite to the nearby Nelson platform.


The Anglo-Dutch oil major drilled the Phoenix discovery well in block 22'12a with Transocean's rig Sedco 711 in November and December 2004. The well encountered a 60-ft hydrocarbon column but was not tested.


Phoenix lies southeast of the company's Nelson platform and is a potential satellite development, although an appraisal well is likely to be required before any tie-back project gets underway.


'If this discovery is developed it has the potential to allow Shell to increase its portfolio of existing oil and to extend the life of nearby infrastructure,' said Rien Herber, Shell Europe's exploration director.


Shell's partners in the block are Austrian oil firm OMV, US independent Apache Corp, which operates the nearby Forties field, and Petro Summit Investments.


'This oil discovery is the second exploration success after the Rosebank'Lochnagar well for OMV UK in 2004 and shows that there is still attractive growth potential left in the UK,' said OMV's head of exploration and production Helmut Langanger.


'The UK is a core region for OMV where we plan to expand our portfolio.'


It will get its chance in the next licensing round that was launched this month.


Apache joined the consortium through a multi-well farm-in deal with Shell, where the Houston-based firm will drill up to four wells in the central North Sea.


'This is the first of what we hope to be numerous joint operations with Shell in the North Sea, where we believe there remain many exploration and development opportunities,' said Apache's UK managing director John Crum.


The well on Phoenix is the first of the three firm exploration wells that Apache has agreed to drill on Shell- operated acreage to gain a 50% stake.


The US firm, which has turned around production at the nearby Forties field, will operate blocks 22'6a, 22'7, 22'11 and 22'12. Each block is likely to have an exploration well under the farm-in deal.


Shell started production from the Howe field, the first satellite to Nelson, late last year and potentially has another satellite, according to OMV, in the Bardolino discovery in adjacent block 22'13a.


Meanwhile, Amerada Hess has spudded an appraisal well on the Melville field in the northern North Sea to firm-up more oil reserves prior to developing the field.


The US oil firm hopes to find up to 100m barrels of reserves in block 210'24a with the GlobalSantaFe rig 140.


If this is successful then Melville could be developed as a tie-back to the Hudson subsea field that flows oil to Shell's Tern platform.


Another possible option also being considered is leasing a floating production storage and offloading vessel, said analyst Deloitte ' Touche.


- ATP Oil ' Gas has awarded contracts for its Kilmar wellhead platform, to be installed in the southern North Sea block 43'22 in the third quarter of this year.


Gulf Island Fabrication of Houma, Louisiana has clinched the contract to build the 1,100 tonne jacket and Lowestoft-based SLP Engineering has clinched the award to fabricate the 500-tonne platform topsides.


ATP is also in the market for another platform for its Tors project. This is likely to be installed in 2006 over the Garrow gas field in block 43'21.


SLP Engineering is finishing off the Horne-Wren wellhead platform for Tullow Oil, which is due to be delivered in the next few months, and is building a platform for ConocoPhillips' Saturn project.

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