Perhaps the most surprising thing about the discovery of the Valhall field is that it was drilled at all; the original seismic records over the area, acquired back in the early 1960's, found much of the information obscured by a large gas cloud, giving the impression of a deep syncline or hole in the middle of the reservoir. But thanks to the persistence and dedication of some of the first geologists looking at the area, it was eventually tested with the drill bit, and one of the most prolific plays in the North Sea was opened up. Richard Hardman was one of those geologists.
Valhall lies in Block 2/8 and 2/11 in the Norwegian North Sea, in waters about 70m deep, close to the borders of the UK and Denmark and about 350 km south-west of Stavanger. It is in the deep, axial part of the Norwegian Central Graben, known as the Feda Graben, at the apex of a structural high known as the Lindesnes Ridge.
"Everyone was trying to get a slice of the action in the North Sea in the 1960's," explains Richard. "It was all very exciting! At the time I was a Senior Geologist with Amoco Europe, operators of the licence, which covered both Norwegian blocks 2/8 and 2/11. We held a 28.33% interest, as did Amerada Hess and Texas Eastern, with the remained belonging to a Norwegian conglomerate called NOCO, which comprised 20 of the largest Norwegian companies, and eventually morphed into Saga."
"NOCO, in particular, was very keen to drill on the block, despite the unpromising and rather confusing seismic, and organised a drillship - actually, due to the lack of availability of suitable rigs, a converted whaler - to undertake the first well, 2/8-1, which was spudded in late 1967. The hole experienced terrible problems; there were continual anchoring difficulties, the well casing collapsed and the weather was appaling, including a ‘once in a 100 years' storm, which severely hampered drilling. It proved a costly exercise. Eventually it was plugged and abandoned before reaching its objectives. Incidentally, the converted whaler went on to find the Claymore and Piper fields, so it wasn't the fault of the technology, just bad luck for the most part," Richard adds.
Undeterred, the partners did not give up on the acreage, drilling 2/11-1, near the border between the two blocks, in the summer of 1969. "The well was sited away from the obscuring gas cloud, as we thought it covered a gap in the reservoir," explains Richard. "The objective of this wildcat was to test all horizons down to the Rotliegendes. We found oil in our target Late Cretaceous Tor Chalk formation, but in relatively minor amounts, with flows of about 200 bopd, and the well was plugged and abandoned as a minor discovery."
Over the next few years, the consortium drilled 2 more wells to the north of 2/11-1. Well 2/8-3 (completed in September 1972) was water-wet and 2/8-4 (completed in June 1973) had one meter of oil bearing chalk. "These wells were also all drilled on the edge of the seismic ‘hole', because we had no evidence as to what was structurally going on in the area obscured by the gas," Richard continues. "There were no seismic reflectors. Obviously, the presence of the gas itself indicated the existence of hydrocarbons, but it was very difficult, given the limitations of seismic processing at the time, to build a useful geological model in our heads."
Drilling the ‘hole'
"However, in 1969, just days after our unsuccessful 2/11-1 well, Phillips had drilled straight through a seismically obscuring gas cloud about 80 km to the north, structurally on trend with our area - and had discovered the billion barrel Ekofisk field. Don Hughes, who was a theoretical geophysicist working with me in Amoco, suggested that maybe our ‘hole' was similarly a structural high affected by the velocity pull-down effect of the gas, and proposed that we drill through the centre of our ‘doughnut', rather than round the edges as we had been doing. Geologists from Phillips also encouraged us to drill, based on their Ekofisk experience."
There was a strong lobby against this idea among the partnership, particularly in Amoco, but late in 1974 we drilled through the centre of a similar but smaller gas chimney on Block 2/11, 13 kilometres to the south of what we now know as the Valhall field, close to the Norwegian - Danish border. "This was so controversial," adds Richard, "that Senior Amoco Managers, who were on holiday when the well was spudded, wanted to stop it, but the point of no return had been reached as the well was half way down. Well 2/11-2 (completed December 1974) came in with good oil flows, and we discovered the 70 MMbo Hod field."
This well had a disappointing element, as although oil was found in reasonable quantities in Cretaceous formations, the main Tor Chalk was missing. It did, however, give Richard and his colleagues the evidence, and the confidence, needed to go ahead and drill through the large gas cloud on Block 2/8. In June 1975 they drilled 2/8-6 (completed June 1975), and found a 20m oil column in the Late Cretaceous Tor and Hod chalk formations, which exhibited an amazing 50% porosity. The Valhall field had been found!
(Wells 2/11-1 and 2/8-4 were later reclassified as appraisal wells by the Norwegian Petroleum Directorate (NPD)).
Billion barrel field found
Over the next few years four more wells were drilled on the prospect, all of which were successful. "The partners, Amoco senior management in particular, were still not convinced," Richard continues. "Finally, in 1978, we had a ‘crunch' meeting, when Amoco summoned the partners to their imposing offices in Chicago, where Amoco tried to brow-beat the smaller companies into postponing follow-up drilling. Although at the time I was working for Amoco, in a relatively junior capacity, I was as keen as the other partners to go for production."
"With hindsight, I realise that it's far more difficult to make these decisions in a big company, with several layers of bureaucracy and management to go through, with the final decision being made by people far distant, both geographically and mentally, from the prospect. I later joined Amerada Hess, a smaller organisation, where I found it much easier to influence senior management and get decisions made quickly."
Eventually, the Valhall field went on stream in 1982, and since then has produced over 625 MMb (100 m3) of oil. It covers 50 km2, had original recoverable reserves of 924MMbo (147 MMm3, 26 Bm3) and still has an estimated 290 MMbo (46 MMm3) left to be extracted at the end of 2008.
Chalk flows like toothpaste
One of the main issues with chalk reservoirs lies in the nature of the rock type, and the problems of extracting oil from it. Chalk is a very pure limestone composed from minute cocoliths, which results in a fine-grained sediment with excellent porosity, very low permeabilities (less than 20mD) and large internal surfaces. This can lead to initial recovery factors as low as 10%.
In addition, particularly high porosity in Valhall meant that the rock over the crest of the field turned fluid under pressure. As Richard puts it, "in Valhall, the chalk flowed like toothpaste! The chalk over the crest exhibited the same seismic properties as the overlying clays, which went a long way to explaining many of our original interpretation questions." Gas was escaping from the reservoir, as evidenced by the gas chimney, so the overburden pressure continually increased, preventing the chalk from consolidating properly. This was just one of the issues facing the people involved in the development of the field."
Reserves increase by 138%
Over the years methods of extracting oil from chalk reservoirs have improved considerably, with techniques such as waterflood, fracture stimulation, directional drilling, particularly the use of horizontal wells, and 3D and 4D seismic processing and monitoring all playing their part. As a result, reserves estimates for fields with chalk reservoirs have consistently increased, and Valhall is no exception. Originally anticipated to hold about 400 MMbo (63 m3) recoverable in 1981, reserves estimates have increased by 138% since that initial figure, and Valhall is now thought to be capable of producing over 1,000 MMbo (150 MM m3) recoverable reserves, from an initial 2.4 Bb of oil in place. Daily production for 2009 is 41,000bopd.
Another problem resulting from the poor consolidation of the Valhall reservoir became apparent after a few years. As oil was removed from the rocks, the reservoir compacted and the seabed shrank, meaning that the facilities have had to be jacked up. The seabed has subsided by over four metres and drilling has become increasingly difficult with time, as subsidence has narrowed the window between fracture gradient and collapse pressure in the overburden. A new platform with processing plant and accommodation is under construction, to replace the aging existing infrastructure, as the field is expected to be in production for another 50 years.
Ekofisk has experienced similar problems, and since the start of production in 1971, the seabed has subsided by over 8 m as a result of reservoir compaction. Waterflood techniques in this field were expected to reduce compaction and subsidence, but studies found instead that high-porosity, oil-filled chalk compacts strongly when flushed with seawater.
So who can actually take the credit for finding Valhall? "Lots of people do - but it wasn't me!" laughs Richard. "There are Norwegians Kjell Finstad and Carl Wilhelm Carstens, both instrumental with NOCO in pushing exploration in the Norwegian North Sea in the 1960's. The Amerada Hess team working on Blocks 2/11 and 2/8, including Bob Briggs, Nick Trynin and Bill Smith, were the ones who pushed the partners to drill through the gas chimney and refused to be brow-beaten by the ‘big boys'. And many others, so perhaps it's safest to say it was a team effort"
Several important lessons have been learnt from Valhall, and put into practice exploring for other fields. A good example is the South Arne Field, in the Danish North Sea, about 50 km south of Valhall. "Oil was first found in South Arne in 1969, but it was not considered commercial," Richard explains. "This first well, though, was drilled updip of the gas cloud. One of the many important things we discovered from Valhall is that oil can occur down dip from the gas cloud, so when Amerada Hess took over the licence in 1994, when I was Exploration Director, we realised that it could be an analogue for Valhall. This suggested that there may be oil beneath and downdip from the gas, even though this seemed outside the mapped closure. We drilled accordingly, and found the 200 MMbo (32 MMm3) South Arne field, primarily a stratigraphic trap with a tilted oil/water contact."
Fun of exploring
Another key lesson to be learnt from Valhall, in Richard's opinion, is the importance of seizing an opportunity when it presents itself. "The long approval chain needed to get permission to drill meant we nearly lost the chance. This is a situation which has probably got worse rather than better since the 1970's, and it is something oil companies need to be very aware of when planning their management structures."
Valhall remains an important field in the annals of exploration in the North Sea and throughout the world. The Valhall gas chimney scenario has found analogues as far apart as Indonesia, Poland and the Gulf of Mexico, as well as nearer home. Richard still remains excited by the discovery, which he considers unique.
"No other field in the world, so far as I know, has a reservoir with over 50% porosity and rock properties similar to clay. This is the fun of exploration - finding conditions we never expect, and solving the issues they produce!"
GEO ExPro 2004, No 3; Chalk - Multipurpose use