North Sea Oil & Gas Exploration: Courageous Risk Takers Needed
Experienced oil-man John Brooks thinks that there is still a great deal of potential in the deep reservoirs of the southern North Sea. "To test the deep potential,we need political initiatives and the harnessing of technological innovations, coupled with a willingness by big companies to take a risk," he says.
"It is remarkable to note that no well in any basin in the North Sea has evaluated the full succession through to basement. The deepest well in the Southern Gas Basin was drilled to a depth of about 6,500m, while the basin itself is thought to have a total thickness of about 12,000m."
"Why are we ignoring these lower potential reservoirs?" says John Brooks, CBE (Commander of the British Empire, a high honour given by the Queen), for many years Director of Exploration and Licensing at the UK Department of Trade and Industry (DTI).
"My colleagues at the DTI often teased me about my obsession with the possibility of finding Cambrian oolite reservoirs in the North Sea, just as they have been found in Oman and elsewhere. We don’t have to look as far as Oman for interesting pre-Carboniferous reservoirs, but if we don’t look for them at all, they certainlywon’t be found!"
New Play Concepts in North Sea Exploration
Current exploration efforts in the North Sea concentrate on plays in the known drilled succession, and do so very successfully. However, the present perception in the industry is that the UK Continental Shelf (UKCS) is mature and that anything left will be relatively small. As a result, many of the majors have moved out of the area, finding it easier to buy or explore elsewhere in the world. John Brooks points out that the ‘Promote’ initiative is doing an excellent job of mopping up the remaining relatively small reserves in the known areas and plays, at affordable costs. "This is what I call ‘snuggle’ exploration, dealing exclusively with what is known.Exploration,however, is also about the unknown - new play concepts which may prove to contain hydrocarbons and which will need imaging, evaluation and drilling."
To begin to gain some idea of the potential of the deepest parts of the North Sea, a number of challenges need to be overcome. John Brooks summarises these as technical problems, associated with the successful acquisition and processing of seismic imaging to a depth of about 12 seconds, as well as those related to the drilling of very deep wells; and licensing and bureaucratic issues such as ensuring acreage is obtainable and making funding available for such innovative exploration.
Deep Oil and Gas Potential in the Southern North Sea
Our current knowledge about the prospectivity of the Pre-Carboniferous in the Southern Gas Basin and the Central North Sea is very limited at present.This is because few wells are being drilled into this succession and seismic data is focussed on shallower stratigraphic levels.
John Brooks says, "We know, first of all, that the basin extends a further 6,000m or more below the currently drilled horizons. Furthermore, we know that Palaeozoic source rocks and reservoirs may exist. The problem is we appear to have stopped drilling further a few years ago because at the time we could not see any deeper, not because we knew what was there. In the Southern Gas Basin we know we have Cambrian on the edges of the basin on both the UK and the Dutch sides, so there is certainly evidence of continuity."
He also notes that exploration in Palaeozoic rocks is proving very fruitful at the moment. He sites North Africa as being an example of successful exploration in older rocks, albeit with different geological concepts from those in the North Sea. In Europe, the Latvians have production from the Lower Palaeozoic succession sub-cropping beneath the Lower Devonian, at a depth of about 1,600m.They have structural traps in the Cambrian, and stratigraphic traps in Ordovician and Silurian reefs as well as in Cambrian pinch-outs. Similarly, in Poland, Lower and Middle Cambrian sandstones form reservoirs overlain by a regional seal of Ordovician and Silurian shales.
"We don’t know whether, if there are any hydrocarbons in the Pre-Carboniferous of the North Sea, they will be oil, gas, or completely over-mature. Rocks usually become more indurated with depth, but as we all know, there are many exceptions to this. I can think of a number of examples from the North Sea where porosities have not decreased with depth, much to everyone’s surprise."
Government Funded North Sea Exploration
"Imaging is key," says John Brooks. "Modern seismic has improved to an amazing level over the last decade,and we now have the ability to image below the salt and to great depths."
"There are still technological issues to be considered, such as filter termination and improvement of 3D imaging, but we are on the way to overcoming these. Long offsets, together with new processing methods, have produced very interesting results, but perhaps the decision makers in the industry are not really aware of just how deep we can image? A number of long offset lines run in the Central North Sea clearly demonstrate the pre-salt horizons. The results are fascinating." "Of course, we are now all accustomed to such excellent seismic, particularly since the advent of 3D, that we tend to drill on clearly imaged prospects and, at least in the North Sea, within a known stratigraphic column. Finding has become easier.We may need to go back to basics and revert to the mindset of the 60’s, when we didn’t drill with such certainty," John Brooks claims.
To start looking seriously at these deep potential reservoirs, an extensive seismic programme is required. As John Brooks is only too aware, seismic is expensive, and it is highly unlikely that seismic companies will be able to cover the whole of the North Sea with long offset data on a speculative basis.How, therefore, do we fund this initial acquisition of data? It would appear that assistance from government would probably be needed.
North Sea "Deep Reservoir" Licensing Round
John Brooks feels that in order to encourage oil companies to start to look at the pre-Carboniferous in the Southern North Sea,we need to convince government that there is a chance of finding reserves there. "Maybe shoot just a couple of speculative lines and show them what can be seen."
Once interested, there are a number of actions that the government could take. "They could, for example, commission seismic surveys and possibly give tax breaks to companies buying the newly acquired data. And it would be wonderful if we could get the Norwegian, Danish and Dutch governments to work with the UK on an intergovernmental initiative in this, so we could draw up the whole picture of the basins in the North Sea, to the benefit of everyone."
"Some creative thought also needs to be given to ways in which we can make acreage available to oil companies interested in these potential reservoirs. A ‘deep reservoir’ licensing round might help concentrate minds. At the moment, all licences commence at the surface and subtend to the centre of the earth, but no one is actually drilling below 6,000m. We could suggestthat companies relinquish their entitlement to the subsurface below 6,000m and that this lower part is then re-licensed on frontier terms."
Once seismic has been obtained and potentially drillable prospects identified, there is the problem of how to finance this deep prospect investigation. Exploration is usually funded from production, but oil companies will be unwilling to divert funds from more certain areas.
Suggests John Brooks: "This is not really for the Promote licensee, who is working within the known at affordable depths. It is much more expensive and will need investment from government and the major oil companies.We need to encourage the majors to remain in or return to the North Sea. Perhaps government could take the initiative and help fund a number of wells to test the viability of Palaeozoic reservoirs. Once governments were convinced that there was a chance of finding further resources, then maybe instead of taxing oil companies on windfall profits, they could persuade companies to put the money into this type of frontier exploration."
Alternatively, it is possible that existing licensees or financiers and venture capitalists will need to be involved. As John Brooks says: "There must be people in the major companies who are also thinking that if you look below the Carboniferous in the North Sea, you’ll come up with a few surprises - I can’t be alone in the world! What we really need is discussion on the various funding options."
John Brooks: Blue Sky Thinking
John Brooks agrees that it is possible that market forces will dictate, and that only when we run out of known hydrocarbons will explorationists start to look for these deep reservoirs.
"I’m a great believer in market forces,but I do think that you have to be a bit prudent too. If we leave it too late, companies will have moved out of the North Sea and we will have lost our infrastructure. If market forces are going to tell you something in a number of years time, by which time you will be unable to do anything about it,then it is necessary to have the idea earlier, and plan ahead."
‘If the perception is that we are constrained on the amount we have to extract,and we are starting to look elsewhere, then it follows that we should be putting some amount of effort into establishing whether or not there is potential in these deep reservoirs. If you want your own country to be as self sufficient as possible, you would be expected to look at all possibilities.We can’t just walk away and say no to such exploration when we have the ability to actually see to these depths.’
John Brooks considers that there is less willingness to take risks than there used to be, with new play concepts often left untested. "This is partly because business finds it hard to understand failure. No percentage is given to thinking outside the box." He feels that the excellent quality of much modern 3D and 4D seismic means that geologists are used to drilling on such well-imaged prospects, that any area not clearly imaged is instantly less attractive. He also questions whether geologists have sufficient decision-making authority in many companies.
"Considerable investment in technology is being made in order to harness alternative energy sources," he says. "Compare that to the idea of looking at deep reservoirs in the North Sea.The infrastructure is in place and we have the technology to look a lot deeper than we currently image, so why don’t we do it? Is it simply because it takes us into unknown territory, where the play concepts and geology are undefined?"
John Brooks does not see the value in being pessimistic, which he considers is the easy way out. "I know discussing the hypothetical idea of pre-Carboniferous reserves in the Southern Gas Basin is what some people call Blue Sky thinking – but why not? Prove me wrong!"
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