Snorre Saga Continues
Thursday 29 June 2017
Snorre was originally expected to be shut down three-four years ago. The government is now awaiting new plans to extend the producing life of this North Sea field until 2040 or beyond.
The Snorre reservoir is regarded as complex, and has given many an expert headaches since its discovery in 1979. Developing the field has been difficult and exciting, with three operators – Saga Petroleum, Norsk Hydro and now Statoil – and much conflict.
But all the discussions and disputes resulted in calculations and plans which have more than doubled estimated reserves since production began in 1992.
The original plan for development and operation (PDO) put recoverable oil at almost 750 million barrels (119 million standard cubic metres).
Steady drilling of new wells has helped to boost that figure to just over 1.7 billion barrels, and the new PDO due in late 2017 should boost this above 1.9 billion. That makes Snorre unique in improved recovery terms.
Saga’s initial PDO expected production to cease in 2012-14. As with so many Norwegian fields, however, the Snorre operator and licensees have learnt more, acquired better technology, become familiar with the subsurface and identified new opportunities.
Saga applied for only one operatorship during Norway’s eighth licensing round in 1983, covering block 34/7 in the North Sea west of the Sogne Fjord.
It secured that job, but on condition that it joined forces with an experienced oil company to act as guarantor for the selected development solution. The choice fell on Esso Norge.
A single installation was originally proposed, and Saga secured acceptance for the Snorre A tension-leg platform (TLP) tied to a subsea template.
Two options were initially in line for the next phase – either redeploying the A unit to produce the northern part of the field or installing more templates on the seabed.
But neither course was chosen. Instead, the Snorre B semi-submersible came on stream in 2001. In 2010-11, Statoil – now the operator – proposed installing just one template in the north.
Bigger
This would improve recovery, but the government felt a much bigger solution should be considered. Simply “skimming the cream” did not meet the Petroleum Act’s requirement that all commercially profitable resources are recovered.
A Snorre C platform was chosen as a third concept in 2013 and gave birth to the Snorre 2040 project. Then industry costs rose as oil prices plunged. It was back to the drawing board.
Few fields on the NCS, if any, have probably occasioned more meetings between operator, licensees and government than Snorre. Ministry, cabinet and Storting (parliament) know it well.
An important milestone was reached in the late autumn of 2016, when the licensees resolved to continue the project under its new name of Snorre Expansion.
The platform concept has been abandoned and the solution will now be a big development with six or seven templates tied back to Snorre A to provide capacity for up to 28 new wells.
While a total of 93 wells were originally planned for the field, more than 120 production and injection wells have actually been drilled so far.
It is no secret that the companies and the government have been at odds over the best way to manage the Snorre resources, with the authorities largely relying on objective arguments.
But they have also turned to stronger measures by setting conditions for the companies, which have been dependent on getting the production licence extended.
That is because Snorre was initially expected to have a much shorter producing life – and the government has exploited this opportunity to get progress and the necessary project decisions.
These commitments have been adopted at the same time as Snorre’s operational regularity has steadily improved in recent years.
The latest temporary licence extension expires in June 2018, and a new PDO must be approved by then. If it is, the two licences covering Snorre will be extended.