A final decision on Gazprom’s Shtokman project is expected by year’s end, and drilling of its first production well will begin this year, the head of its Russia gas operation said.
Both projects represent large steps in a long-term program to significantly increase Russia’s offshore production, said Vsevolod Cherepanov, head of the Gas, Gas Condensate, and Oil Production Department at Gazprom. The Russian Federation’s hydrocarbon resources development plan calls for offshore reserves to increase from 15% to 43% of total reserves by 2030.
The centerpiece of the program is the oft-delayed Shtokman project. The next step—a final investment decision—is now expected by the end of the year, Cherepanov said. The Sakhalin III project, though, is moving ahead of schedule. First production was moved up because gas demand is stronger than expected. The recent nuclear disaster in Japan may result in a further change of plans. There are six gas production wells located 44 km off the coast of Sakhalin Island in Russia’s Far East.
The current plan to move gas by pipeline to serve the Russian market may change, he said. In the wake of the tsunami that destroyed a major nuclear plant in Japan, Gazprom is considering redirecting gas from the Sakhalin project and expanding its LNG exports, Cherepanov said.
Looking ahead, Russia is exploring enormous gas reserves on its continental shelf. Over the next 20 years, it expects that more than 60% of its added offshore gas production will come from the Yamal Shelf and 20% from the Barents Sea, he said.
Drilling Cost Reduction Drives Statoil Rig Design
With a goal of cutting operating costs by 20%, Statoil said it is moving ahead with a project to build a new generation of rigs designed to drill and complete wells on the Norwegian Continental Shelf.
The company is seeking bids to build the first two of its Category D design, which it plans to have in service by next year. The design relies on proven technology to maximize productivity using what Jon Arnt Jacobsen, Statoil’s chief procurement officer, described as a standardized industrial approach to cost reduction.
For example, the design focuses on creating expansive deck spaces to streamline operations and reduce the risk of accidents caused by falling objects, a danger on older vessels with multiple deck levels. There will also be a focus on automated material handling equipment, separate systems for drilling fluids and completion fluids, and a design that contains spills on board.
There are still variables in the process, including two hull designs for bidders to choose from. To encourage participation, Statoil is offering long-term lease terms—from 8 to 20 years—and will become an equity partner if needed.