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Repsol in race against clock on Yme

Spanish operator seeks to accelerate redevelopment plan for field off Norway as it closes in on platform award and final investment decision

Repsol has issued a revised impact assessment study for a proposed redevelopment of the Yme field off Norway as it seeks to accelerate the process towards a final investment decision due this year, having lined up a deal for a jack-up production platform.

The Spanish operator is now apparently on the point of awarding a contract for a converted jack-up with processing topsides after talks with an unnamed contractor recently “reached a stage of maturity so the parties were in agreement”, according to a letter to the Petroleum & Energy Ministry obtained by Upstream.

The front-runner for the contract was previously understood to be Maersk Drilling-owned unit Maersk Inspirer, though rivals Rowan and North Atlantic Drilling Ltd are believed to have been involved in the tender launched last year, and Repsol had been hoping to issue an award this spring.

Repsol has now matured the so-called Yme New Development project to the DG3, or final sanction, stage and has applied to the authorities to shorten the consultation period of the impact assessment issued this month from 12 to six weeks to speed up processing of a proposed development plan.

It stated in the letter that the project will shortly be presented to licence partners for a final investment decision.

Any further delay could result in the contractor pulling its bid and instead opting for an alternative project, which would result in Repsol and its licence partners having to go back to the drawing board on the concept and thus stall start-up of the field, the company stated.

Repsol is under time pressure as it has an extended deadline of year-end to file a decommissioning plan for Yme to the authorities, with an estimated Nkr3 billion ($379.6 million) price tag, or a revised development plan.

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Moving forward with a redevelopment of the field is seen as the best economic solution as it would generate production revenue while also postponing decommissioning for the estimated 10-year producing lifetime of the field.

Furthermore, Repsol said it needs to get moving on a redevelopment to make use of existing subsea infrastructure at the field, including a caisson storage tank, on which work has to be carried out next year.

The operator has taken onboard the converted jack-up concept originally touted by partner Okea to redevelop the field after a previous ill-fated development effort by Talisman Energy - now owned by Repsol - that resulted in scrapping of a faulty newbuild production unit before production even started.

Okea failed to reach a transition agreement with Repsol to take over operatorship of the field, though a source said the latter is still understood to be looking to exit the project due to the perceived redevelopment risk, mainly related to using previously drilled production wells.

Under the new development plan, Repsol intends to re-use six existing production wells and three injection wells, drilled in 2009 and 2010, as well as drill a total of six new wells - four producers and two water injectors - to tap estimated remaining resources of around 70 million barrels of oil equivalent.

Two of the new production wells would be drilled via a new subsea template in the Beta Nord and Beta East structures at the field, while the other two would be drilled into the Gamma formation and a sidetrack would also be sunk at a later date.

The total drilling duration is estimated at 633 days, offering a potentially lucrative long-term contract for rig players.

Repsol has though ruled out possible electrification of the field from shore - a requirement from the authorities for new development projects - and said the optimal power solution would be a pair of in-situ gas turbines installed on the platform.

The main reason, it stated, was the long approvals process for an onshore transformer station that could result in a two-year delay to start-up of the field.

Repsol holds a 60% operating stake in production licence 316 that hosts Yme, with partners Lotos E&P (20%), Kufpec (10%) and Okea (10%).