Taking its time

An Esso gas discovery was made by the Drillmaster rig with well 15/6-2R in 1974. Thirty-five years later, the licensees are considering whether Dagny is ready to be developed.

Geologist Dag Bergslien has retrieved files and cardboard boxes of material about Dagny from ExxonMobil’s library in Stavanger. Digital storage was not available in 1974.

None of those involved in the discovery still work for the company, at least in Norway. Mr Bergslien, who was 18 at the time, has spent the past few years in a team looking at possible development solutions for Dagny.

Ekofisk, the first field to begin production on the NCS, had been discovered five years earlier and 1974 proved a golden time for Esso.

Sigmund Hanslien, who joined the US oil major that year, recalls such discoveries – as operator or licensee – as Odin, Sleipner West, Statfjord and North-East Frigg.

That may be precisely the reason nothing more happened at that time with Dagny – a small find overshadowed by other and far more formidable development jobs on the NCS.

Appraisal well 15/5-1, drilled by Norsk Hydro in 1977, confirmed that Dagny contained gas.

Not forgotten
Its resources were by no means forgotten and they were considered for development on several occasions over the years, based on a tie-in with Sleipner West to the south-east.

A solution which involved viewing Dagny together with Britain’s Miller and Brae fields was also in the picture, Mr Bergslien reports.

Agreement was reached a few years ago by Statoil, Total and ExxonMobil to plan for a Dagny development via the Sleipner area, where production was expected to decline from 2008.

But Mr Bergslien notes that a thin reservoir and lack of resolution in the seismic data, combined with the shortage of wells in the area, made it difficult to determine Dagny’s size.

Statoil took a closer look at the geological landscape in the surrounding area, and defined the Ermintrude prospect in 2006.

Development plans for Dagny were put in ice until other opportunities in the neighbourhood could be explored. Another find might open very different possibilities – and oil and gas were duly discovered in Ermintrude during 2007.

That prompted the geologists to wonder whether oil could be lurking below the gas in Dagny – and whether that zone might be connected with Ermintrude. This was confirmed by a well in the autumn of 2008.

“After these wells, it was full speed ahead,” reports Svein Olav Høyland in StatoilHydro, who heads the project team producing a feasibility study for the discoveries.
A decision is due to be taken in the autumn on whether the field is commercial. Should that be positive, a study will be produced as the basis for choosing a development solution.

Dagny and Ermintrude jointly contain some 200 million barrels of recoverable oil equivalent. Mr Høyland estimates that this figure is split about 50-50 between them.

These recoverable resources are slightly smaller than the Goliat and Gudrun fields in the Barents and Norwegian Seas respectively.

“What would have been a small discovery 20 years ago is big today,” Mr Høyland observes. If Dagny/Ermintrude are developed, one solution could be to transfer their output to the Sleipner area via a production platform or subsea installations, and from there to the market.”

The work now being pursued with these two finds clearly shows how important it is to explore in mature parts of the NCS close to existing infrastructure.

Mr Høyland also highlights the time factor. It is difficult to tie new resources into a field in full production, but this can be done once output has gone off plateau.

That presents a window which remains open until the field shuts down, and offers opportunities to secure considerable value creation from nearby discoveries.

Large volumes can be processed on Sleipner A. Production from Gudrun is to be tied in to that platform from 2013. If things turn out as StatoilHydro and its partners hope, Dagny/Ermintrude can follow a couple of years later.

StatoilHydro also has seven-eight other satellite fields under planning for tie-back to the Sleipner installations. A plan for development and operation (PDO) is due to be submitted for Alpha Central as early as this summer.

In addition, an active exploration programme is being pursued in the area. Mr Høyland says that no exploration wells are due this year, but studies will be conducted to mature future drilling targets.

(This article has been published in the NPD journal The Norwegian Continental Shelf.)