Hebron project goes before regulators
Partners in Newfoundland’s fourth offshore oil project have entered the formal regulatory phase, submitting their application to bring the Hebron field into production in 2017, targeting output of 150,000-180,000 barrels per day of 20 degree API crude.
The region currently supports the Hibernia, Terra Nova and White Rose operations, pending a resolution of a lengthy dispute between the Hebron consortium and Newfoundland government over a tax and royalty regime.
The plans filed with the Canada-Newfoundland and Labrador Offshore Petroleum Board estimate Hebron will yield about 789 million barrels of oil over a 30-year production life, the mid-point of resources that range from 660 million to 1.05 billion barrels.
Capital costs are C$3 billion to C$5 billion, of which C$538 million has been spent drilling seven offshore wells since 2008 and covering pre-development costs.
The Hebron asset, 210 miles southeast of St. John’s, Newfoundland, contains three discovered fields — Ben Nevis, which is expected to account for 80 percent of output, Hebron and West Ben Nevis.
The partners are operator ExxonMobil 36 percent, Chevron Canada 26.7 percent, Suncor Energy 22.7 percent, Statoil Canada 9.7 percent, and Nalcor Energy, owned by the Newfoundland government, 4 percent.
Expansion possible Expansion is possible if additional studies, seismic surveys or exploration/delineation drilling identify economically recoverable oil pool accumulations, the application said.
Hebron oil was discovered in 1980 and deemed uneconomic until second-phase delineation drilling which began in 1996 added significant recoverable resources.
The filing acknowledged that Hebron’s heavy crude poses challenges as the viscosity can be 10 to 20 times higher than that of water.
Formation gas produced in association with the oil production will be used mainly to meet the fuel requirements for production and drilling facilities. Any excess gas will be injected into area reservoirs for storage, or to preserve reservoir pressures.
Hebron will be produced from a 400-feet high concrete gravity-based structure sitting in the seabed. It will be capable of storing 1.13 million to 1.45 million barrels of oil.
—Gary Park
|