03 July 2014 09:19 GMT
The company is now seeking to mature an FPSO solution, as well as an alternative semi-submersible production unit, after deciding this week to delay a final decision on a revised concept for the Barents Sea field in order to curb development costs and better determine resource potential.
A previously selected $15 billion concept involving the semisub with pipeline to an onshore oil terminal has been sidelined for commercial reasons despite state pressure for an area-wide solution to tie in future finds, with Statoil saying there were insufficient resources to support the pipe.
Aker Solutions is now carrying out pre-front-end engineering and design work on an FPSO concept under a Nkr250 million ($40.5 million) floater study contract awarded last year following an earlier design contest with rival Sevan Marine, which was touting its trademark cylindrical model.
Aker is understood to be working on a ship-shaped unit with an innovative inverted bow design with ice-breaking capability for the Arctic frontier field.
However, Statoil had earlier rejected a ship-shaped concept in the original evaluation process on Johan Castberg as it had “reduced robustness in relation to safeguarding exploration potential in the area”.
Cylindrical design ruled out
The state-owned operator is being criticised both internally and externally for excluding an evaluation of the cylindrical floater – said to have technical and cost advantages - in the ongoing FPSO study work, given its focus on cost-benefit optimisation, according to industry sources.
When questioned on the issue, a Sevan source told Upstream the company “does not understand why” its cylindrical floater design is no longer part of the concept evaluation process on Castberg.
He explained the turret-and-swivel required for weather-vaning on a ship-shaped floater reduces the flexibility for and restricts the number and type of riser connections that can be installed for future satellite fields.
“Avoiding turret-and-swivel with a cylindrically shaped FPSO would also cut construction and operation costs significantly compared with a ship-shaped unit,” he added.
Offshore broker and naval architect Tore Kulsvehagen of Bassoe Offshore warned a ship-shaped unit would represent “a technical stopper for further development in the area by limiting the number of risers”.
He said a turret-and-swivel typically had a maximum capacity of 30 to 32 riser slots, which was at the lower limit for what was required on Johan Castberg given the need to tie in possible future finds in an undeveloped area lacking existing infrastructure.
The heavyweight turret-and-swivel would also cost between $120 million and $150 million, accounting for a large part of the price of the FPSO, according to Kulsvehagen.
By comparison, the cost of a spread-moored Sevan cylindrical unit with geostationary hull would be lower as it eliminates the need for a turret-and-swivel while it can also have a greater number of riser slots and installation of new connections is easier, he said.
In addition, the flexible circular design allows for more available deck space for retrofitting of additional processing capacity, while the turret-and-swivel requires more maintenance and also increases the need for manpower onboard, he added.
Furthermore, a ship-shaped unit would pose major challenges for electrification of the Barents field, which is a key requirement of the government, according to Kulsvehagen, who asserted he was speaking independently and had no business engagement with Sevan on the FPSO side.
“Running a high-voltage cable up through a turret-and-swivel is basically unproven technology and would be virtually impossible,” he said.
By comparison, the cylindrical FPSO being used for Eni’s nearby Goliat oilfield will be powered from shore.
Electrification for Castberg has earlier been ruled out by Statoil and partners Eni and Petoro due to high costs and lack of available cabling technology to cope with the 280-kilometre distance from the coastline.
Kulsvehagen suggested delivery delays and cost overruns on the Goliat unit may have deterred Statoil, which tends to take a conservative approach by sticking to proven technology, though he underlined these issues were not related to the Sevan concept but to project execution, vendor problems and modifications by Eni.
He also pointed out Aker had earlier presented its own cylindrical design to compete with Sevan’s concept, which has led to a patent row between the two rivals, and Statoil may therefore have opted to focus on the ship-shaped FPSO to steer clear of the contentious issue.
A Statoil spokesman confirmed a ship-shaped FPSO and production semisub are the only floater options being considered for Johan Castberg.
He explained the ship-shaped FPSO was earlier seen as having reduced robustness to develop deeper prospects in production licence 532 that hosts the field but that these were found not to contain oil in a recently completed exploration campaign.
“Statoil and the licence considered several concepts including Sevan Marine’s circular concept in 2012. The semisub and ship-shaped FPSO were shown to be best in a total assessment and we therefore opted to continue working with these options,” he said.
Need for tie-in capacity
In an earlier impact assessment study, the partners stated the Castberg infrastructure should “safeguard tie-in and production from new finds” both in the licence and surrounding area, adding it should be able to handle up to 1 billion barrels of output over its lifetime.
The Norwegian Petroleum Directorate’s principal engineer for field development, Rannveig Storebo, would not comment on the relative merits of potential concepts for the field.
But she said: “We are following the work in the licence and are preoccupied with Statoil and its partners selecting a robust concept that is flexible enough for potential upsides.
“This is the first development in a new area of the Barents and we expect them to find a long-term solution that will maximise the value creation from the field and can contribute to making smaller discoveries in the area commercial to develop.”
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