Published by the DTI Oil & Gas Directorate for the reservoir engineering and IOR community in the UK.
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Remaining Potential and Opportunities on the United Kingdom Continental Shelf (UKCS) and the Need for New Entrants*

Jim Munns is a Senior Geoscientist with the UK Department of Trade and Industry. He is currently Project Manager with responsibility for promoting the UKCS internationally with the aim of attracting New Entrants. Here, he discusses the need for new entrants to the UKCS.

Introduction
A recent focus for the UK Department of Trade and Industry (DTI) has been to attract 'new entrants' into the UK Continental Shelf (UKCS), see Figure 1. In May 2001 the DTI set up a small marketing team whose purpose is to broaden the company base in both exploration and development activity on the UKCS. The marketing strategy has identified two types of new entrant company that the UK is keen to attract:

• Independent oil companies, particularly those with the resources to drill wildcat exploration wells, that are not currently represented in the UK North Sea
  
• niche "developers", particularly those with experience of the Gulf of Mexico, to develop previously undeveloped discoveries by utilising technically innovative and best cost solutions

The proliferation of megamergers in recent years has resulted in there being fewer major operators active on the UKCS, resulting in smaller overall exploration and appraisal budgets. Oil and gas production in the UK peaked in 2000, and remains close to record levels at 5 mmboe per day but decline is projected to start in the near future. An initiative to attract investment from a large number of smaller players will help to arrest this decline.

Historical perspective
Around 4000 exploration and appraisal wells (including respuds and sidetracks) have been drilled on the UKCS over the past 37 years. These wells have resulted in more than 235 producing fields and another 250 plus significant discoveries. The peak of E&A activity occurred in 1990 with over 200 exploration and appraisal wells drilled. The success rate over the last 30 years has been a robust 35%, using a rolling five-year centred average including several significant discoveries made in 2001. Of these 2001 finds, PanCanadian's Buzzard discovery has been press-released with reserves of 300-400 mmboe. This is the largest discovery on the UKCS since the Schiehallion field discovered in 1993 and the largest in the UK North Sea since the Nelson field discovered in 1988.

The maximum case ultimate recoverable reserves in the UK sector are estimated to be approximately 80 bboe (billion barrels of oil equivalent). By the end of 2000 cumulative production measured approximately 30 bboe. The estimates of Yet-to-find reserves are in the range of 4 - 27 bboe (source: Development of the oil and gas resources of the United Kingdom - a Government publication), see Figure 1. These government figures appear to be consistent with industry thinking.

Petroleum Geology of the UK North Sea
The geological evolution of the North Sea area is very complex. The UK and the North Sea have largely lain in an intraplate setting from the Permian to present day. Nevertheless, the area has been far from quiescent. Glennie and Underhill (1998) identify five main tectonic events that control present day hydrocarbon occurrence, resulting in a variety of hydrocarbon rich basins with significantly different geological histories. These tectonic events were:

1. Permo-Triassic rifting and thermal subsidence, possibly coeval with the initiation of subsidence in areas that were later to become the Viking and Central Graben systems of the North Sea. The Permian dune belts of the southern North Sea developed in an area to the south that was little affected by later Jurassic tectonic events.
2. Middle Jurassic domal uplift, led to widespread volcanism and the subsequent development of a trilete rift system in the northern and central North Sea.
3. Late Jurassic to earliest Cretaceous crustal extension, resulted in the formation of major rotated fault blocks within the Viking and Central Grabens, which contain many of the largest North Sea oilfields. The North Sea is then characterised by post-rift thermal subsidence during the late Cretaceous and the Tertiary.
   
4. North Atlantic rifting, this effectively superseded thermal subsidence to the west of the UK mainland. Significant deepwater sands were deposited during the Tertiary, and form the main reservoirs of the Foinaven and Schiehallion fields.
   
5. Tectonic inversion of the Mesozoic basins, resulting in the inversion of former sedimentary basins across north-west Europe during the Tertiary.

The petroleum systems of the main basins are well documented. The vast majority of the reserves found to date lie within the areas defined by mature source rocks (Figure 2). Vertical migration of hydrocarbons along fault conduits appears to be the overwhelming mechanism for reservoir entry. The bulk of the oil and gas in the northern and central North Sea basins is derived from a single source rock, the Late Jurassic Kimmeridge Clay. In contrast the southern North Sea gas province has been charged almost entirely from the Carboniferous Coal Measures.

The combination of progressive latitude migration of the UK to the north and attendant climatic variation, structural deformation, erosion and sedimentation is responsible for the oil and gas being found in reservoirs that range from the Devonian to the Cainozoic (Figure 3). At one end of the stratigraphic column is the Clair field, located on the Atlantic Margin to the west of Scotland. Clair field is reservoired in fractured Devonian sandstones whereas the giant Forties field in the Central North Sea is contained in sandstones of Paleocene age. There are oil and gas pools in virtually every stratigraphic interval in between.

The majority of the 235 plus producing offshore fields are located in structural traps. This probably reflects the maturity level of exploration and appraisal drilling on the UKCS as wildcat wells specifically targeted at stratigraphic traps have been rare. The UKCS is an area ripe for innovation, as increasing use is made of modern seismic technology to resolve subtle traps e.g. shear wave acquisition techniques and pore fluid prediction processing techniques.

The Future
The future for UKCS exploration and development activity is projected to follow the two strategic themes highlighted earlier. There are opportunities for wildcat exploration in both genuine frontier areas such as the Atlantic Margin and in the more mature North Sea basins. The recent PanCanadian Buzzard discovery in the North Sea demonstrates that giant oilfields can be discovered in mature areas.

The second strategic theme is the 'niche developer'. There are some 250 plus undeveloped discoveries on the UKCS that represent a significant resource. Approximately 150 of these are within ten kilometres of existing infrastructure and very few are more than 50 kilometres away. Another opportunity lies in the exploitation of heavy oil. There are currently five heavy oilfields in production with a further 2-4 bboe in place discovered awaiting development. The heavy oil play is relatively under-explored.

The two areas identified as having the greatest potential for major new discoveries lie along the Atlantic Margin and in the High Pressure/High Temperature play in the Upper Jurassic of the northern and central North Sea.

There are six plays that appear to offer significant exploration potential on the UKCS. There are a variety of technical uncertainties that need to be addressed, as several of them are non-conventional and will require significant pre-drill technical analysis.

Atlantic Margin Tertiary play
Following the discovery of the giant Foinaven and Schiehallion oilfields on the Atlantic Margin in the early 1990's there has been significant industry focus in the area. The fields are combination traps contained in Paleogene deep-water sandstone reservoirs. Trap definition is complex and reliant on modern seismic analysis such as AVO (amplitude versus offset) analysis. The spatial extent of this play presents a technical challenge due to the presence of upper Paleocene-lower Eocene volcanics that largely mask the pre-Eocene geology from effective seismic imaging. The areal extent of an interpreted mid- Eocene fan complex and the projected feeder channels from the provenance area are shown in figure 4.

Upper Jurassic/Lower Cretaceous stratigraphic play
This play is the lateral basinward pinchout of deep-water sandstones preserved in the hanging wall of major basin bounding faults or flanking large intrabasinal highs. The play is located along the rift bounding faults of the northern and central North Sea.

Mesozoic basin margin play
The recent giant Buzzard oil discovery in UK Block 20/6 has highlighted the potential for traps along the basin margins of the North Sea. These are likely to be subtle combination and stratigraphic traps.

Deep basin plays
In the central and northern North Sea; principally the High Pressure/High Temperature plays along the axes of the rift graben and in the hanging walls of major basin bounding faults. The seismic line in Figure 5 demonstrates the significant depth of the target section. A number of reservoir targets are located both above and below a detachment surface at the Top Permian due to the presence of salt. Conventional pre-rift fault blocks are present in the Permian with rotated slivers of Jurassic and Triassic section exhibiting basinward gravity gliding into the hanging wall of the large fault to the east. In the deeper parts of the Northern and Central grabens reservoir rocks with up to 25% porosity preserved down to 15000' plus are found.

Lower Permian stratigraphic play in the southern North Sea
This play is defined by the updip pinchout of the prolific Permian Leman Sandstone reservoir as the dune belts interdigitate into contemporaneous lacustrine shales at the basin margin.

Palaeogeomorphic traps
L late Palaeocene to early Eocene age around the shelf margin in the northern and central North Sea and the Atlantic Margin.

In summary, the UKCS has proven to be a very successful exploration province in the last 35 years, with a success rate of 35% for its 4000 E&A wells. Recent successes have demonstrated that substantial reserves remain to be discovered in the mature North Sea. Exploration of the Atlantic Margin is still at a frontier stage, but this province has the potential to yield further giant oil and gas fields. The 250 plus undeveloped discoveries offer opportunities for 'niche developers' to develop relatively small discoveries with potential to capture an upside.

The DTI is accelerating its strategy to foster increased exploration activity on the UKCS and its drive to attract committed new entrants. The ultimate aim is to extend the life of exploration and development activity on the UKCS well into the 21st Century.

Bibliography
Glennie, K.W., and Underhill, J.R. (1998) Origin, Development, and Evolution of Structural Styles. In: K.W. Glennie (ed.) Petroleum Geology of the North Sea: Basic concepts and recent advances.

* Originally published in April edition of Offshore magazine

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